Commodity Corner: Default Fears Push Oil Lower

With investors nervous about whether Congress and the White House can agree on a plan by August 2 to raise the U.S. debt ceiling and possibly avert default, crude oil settled lower Monday.

Light sweet crude oil for September delivery lost 67 cents to end the day at $99.20 a barrel. The September Brent contract price fell 73 cents to settle at $117.94 a barrel. Recent debt ceiling negotiations between congressional leaders and the Obama Administration have proven both fruitless and contentious. Key areas of disagreement have been how high to raise the federal government's current $14.3 trillion borrowing limit and how deeply to cut spending to offset the increase. Subsequent negotiations between Democrat and GOP congressional leaders did yield a bipartisan framework proposal, but the White House has increased the specter of default by opposing this potential deal.

The WTI peaked at $99.87 and bottomed out at $98.52 and the Brent fluctuated from $117.00 to $118.31.

The August natural gas contract price ended the day at $4.39 per thousand cubic feet, a penny lower than Friday's settlement price. Natural gas traded within a range from $4.34 to $4.46 Monday.

Front-month gasoline remained flat Monday, again settling at $3.13 a gallon. The August contract price fluctuated from $3.09 to $3.13 during the first session of the week.