Commodity Corner: Traders Gauge Mideast, Debt Fears
Crude futures inched lower Thursday on concerns of another European debt crisis.
Prime Minister Jose Socrates' resignation Thursday fueled suspicions of Portugal having to request emergency aid. Following Ireland and Greece, Portugal will be the third European nation to accept a bailout from the European Union and International Monetary Fund. Traders fear the assistance may generate an economic slowdown in Europe that will cause oil prices to decline.
Light, sweet crude for May delivery settled at $105.28 a barrel, 47 cents below Wednesday's settlement. Airstrikes by the U.S. and its allies in Libya pressured prices as high as $106.69 a barrel. German Chancellor Angela Merkel urged European countries to boycott Libyan oil in hopes of expediting Moammar Gadhafi's removal.
As the violence continues, investors remain weary of continuous oil supplies coming from the Mideast and Northern Africa region. The turmoil continues to keep prices above the $100-mark.
For the first time in three days, April natural gas settled lower. Natural gas settled 2.1 percent lower, at $4.24 per thousand cubic feet, on reports that showed a less than anticipated drop in U.S. inventories. The Energy Information Administration (EIA) reported a decline of 6 billion cubic feet. Natural gas peaked at $4.399 Thursday, before bottoming out at $4.215.
Front-month gasoline futures gained 2 cents Thursday, ending the trading session at $3.02 a gallon. Prices traded between $2.99 and $3.05 a gallon.