Oil slips to midpoint of recent range on econ worries
SINGAPORE (SANA): Oil slid for a second day on Thursday, a day after Fed Chief Ben Bernanke rekindled unease across financial markets over the pace of economic recovery, while rising U.S. inventories also kept prices in check.
Bernanke’s comment that the prospects for the U.S. economy were “unusually uncertain” in testimony to lawmakers on Wednesday sent crude prices back down to the middle of a tight trading range of less than $5 over the past two weeks, after touching a July peak above $78.50 a barrel earlier in the day.
U.S. crude for September declined as much as 40 cents to $76.16 and was down 23 cents at $76.33 by 0647 GMT, while ICE Brent shed 22 cents to $75.15.
“Unusual uncertainty means the market cannot have solid confidence of economic recovery,” said Ken Hasegawa, a commodity derivatives manager at brokerage Newedge in Japan.
Bernanke faces another round of testimony on the economy to U.S. lawmakers on Thursday.
Asian stocks slipped and the yen rose on Thursday ahead of European bank stress tests. The results of the European Union examination of banks are due on Friday and are expected to show generally positive results for Greece, Italy and Ireland and a few failures in Portugal and Spain.
“The crude oil market is waiting to go higher to $80, $85 and $90, but it still needs time,” Hasegawa said. “Everyone understands that the (U.S.) inventory level is relatively high. That is one of the bearish factors that may be capping it down.”
