“Crude slid for the first time in three days in New York on speculation that this week’s gains were unjustified as the U.S. budget deal is insufficient to ensure growth in the world’s biggest oil-consuming country.
Futures lost as much as 0.7 percent after rallying 2.6 percent in the past two sessions as U.S. lawmakers passed a bill to undo automatic tax increases and spending cuts that threatened the nation’s economic recovery. The accord won’t reduce deficits enough to avoid a sovereign-rating downgrade, Moody’s Investors Service said yesterday. Technical indicators showed crude may have risen too quickly, according to data compiled by Bloomberg.
“We’re seeing short-term jitters on the back of Moody’s comments of a potential downgrade in the pipeline if things are not improved in the coming months,” said Michael Poulsen, an analyst at Global Risk Management Ltd. in Middelfart, Denmark.
West Texas Intermediate for February delivery dropped as much as 63 cents to $92.49 a barrel in electronic trading on the New York Mercantile Exchange and was at $92.65 at 11:38 a.m. inLondon. The contract yesterday climbed 1.4 percent to $93.12 a barrel, the highest settlement for a contract nearest to expiration since Sept. 18.
Brent for February settlement on the London-based ICE Futures Europe exchange fell as much as 79 cents to $111.68. Prices advanced 3.5 percent in 2012, a fourth annual gain. The North Sea crude was $19.33 a barrel more than WTI.
Trading volume in WTI was 30 percent below the 100-day average for the time of day, while Brent was 8 percent above…”
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