“Brent crude fell for a second time in three days amid concern that deadlock in U.S. budget talks may threaten to curb economic growth and fuel demand.
The North Sea benchmark dropped as much as 45 cents, reversing earlier gains. European stocks declined for a third day on concern U.S. lawmakers won’t agree to a budget before more than $600 billion in tax increases and spending cuts known as the fiscal cliff start taking effect in January. The Stoxx Europe 600 (SXXP) slid 0.3 percent to 278.53, while indexes in the U.K.,Germany and France slumped.
“Debt reduction negotiations in the U.S. congress continue to cloud the macro outlook going into 2013,” Andrey Kryuchenkov, an analyst at VTB Capital in London, said in a note. “Oil investors would prefer to wait on the sidelines until this is resolved before placing large bets.”
Brent for February settlement fell 25 cents, or 0.3 percent, to $107.91 a barrel on the London-based ICE Futures Europe exchange as of 12:30 p.m. local time. The January contract settled $1.24 higher at $109.15 when it expired Dec. 14. The European grade was at a premium of $20.70 to WTI, down from $22.42 on Dec. 14.
West Texas Intermediate crude for January delivery was at $86.67 a barrel, down 6 cents, in electronic trading on the New York Mercantile Exchange. Front-month prices advanced 0.9 percent for the week ended Dec. 14.”
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