Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Market / Stock-market-news/  Brent falls below $116 after two-day surge; Syria conflict eyed
BackBack

Brent falls below $116 after two-day surge; Syria conflict eyed

Brent posts strongest gain since Jan 2012; Obama makes case for punishing Syria, but possible delays loom

Brent crude for October delivery was at $115.87, down 74 cents by 08:45 am, after rising more than 5% in the last two sessions. Photo: AFP (AFP )Premium
Brent crude for October delivery was at $115.87, down 74 cents by 08:45 am, after rising more than 5% in the last two sessions. Photo: AFP
(AFP )

Singapore: Brent crude slipped below $116 a barrel on Thursday, taking a breather after clocking its strongest second-day gain since January 2012 over fears of oil-supply disruptions in the Middle East as western nations prepared to get involved in the Syrian conflict.

The West is gearing up for a military strike against Syria in response to last week’s chemical weapons attack, although US President Barack Obama faced new obstacles with British allies and US lawmakers that could delay any imminent action.

Brent crude for October delivery was at $115.87, down 74 cents by 08:45 am, after rising more than 5% in the last two sessions.

October US crude fell 58 cents to $109.52 a barrel following a near 4% gain over the past two days.

“The market is overdone to the upside," Tony Nunan, a risk manager at Mitsubishi Corp. , said, adding that more sell-offs could occur if the strike is going to be brief.

Obama said on Wednesday that a “tailored, limited" strike, not a protracted engagement like the unpopular Iraq war, could be enough to send a strong message that the use of chemical weapons cannot be tolerated.

Oil has jumped this week to multi-month highs on fears that the potential strike on Syria could spread unrest to major oil producers in the Middle East and disrupt supply.

“There are so many other parties involved when it comes to Syria," Nunan said. “Israel, Iran are close by and other countries could get dragged into it."

Oil is likely to stay above $110 with support from the Middle East uncertainty and as the Libyan oil supply situation has worsened, he said.

Libya’s crude output has been cut to 250,000 barrels per day (bpd) from pre-war levels of 1.6 million bpd as workers’ strikes crippled exports, Prime Minister Ali Zeidan said on Wednesday.

Brent’s premium to US crude has risen to more than $6 a barrel, the widest since June, on expectations of rising supply at the US contract’s delivery point in Cushing, Oklahoma.

US crude stockpiles rose almost 3 million barrels to 362 million barrels last week, data from the US Energy Information Administration showed on Wednesday, far exceeding a forecast of a 0.2 million barrel build in a Reuters poll.

Crude stocks at Cushing, Oklahoma, have dropped 26% since the end of June to 36.59 million barrels, falling 837,000 barrels last week.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 29 Aug 2013, 09:56 AM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App