NEW YORK (Reuters) - Oil fell more than 3 percent on Wednesday, with worry mounting about the petroleum demand outlook as the euro zone debt crisis pushed the single currency down near a two-year low against the dollar and after China signaled it was not planning a large economic stimulus.
Rising borrowing costs for Spain and Italy and the latest poll showing a lead for Greece's left-leaning, anti-austerity parties ahead of next month's elections added to concerns about the region's economy being enveloped in the debt turmoil.
As crude futures headed for double-digit percentage losses for May, equities and other commodities, like industrial feedstocks platinum and copper, also felt pressure from the worsening expectations for the euro zone economy.
Hopes that China would act to counter slowing growth were dimmed after influential academics said Beijing should shun aggressive fiscal stimulus, in remarks published in leading state-backed newspapers on Wednesday.
Those views joined a chorus of commentary countering market expectations that China might unveil a stimulus package similar to the 4 trillion yuan ($630.1 billion) in spending unleashed during the global financial crisis.
"The European debt crisis and concerns about Chinese economic growth together mean that sentiment is on the very bearish side," said Andy Sommer at EGL in Dietikon, Switzerland. Brent July crude fell $3.28 to $103.40 a barrel at 11:34 a.m. EDT (1534 GMT), having slipped to $103.23.
Brent was on pace to post a monthly loss of more than 13 percent. U.S. July crude slumped $3.10 at $87.66, having fallen to $87.49 as the front-month crude prices headed for a monthly loss of more than 16 percent.
Wednesday's price slide took U.S. crude below the 61.8 percent Fibonacci retracement of the October to March rally at $88.55 a barrel, a key level of support for technical traders.
Pending home sales in the United States fell in April to a four-month low, an unexpected slip, undermining any recent optimism about the housing sector and adding to investor concerns about slowing economies. U.S. stocks on Wall Street fell more than 1 percent, with European equities also posting sharp losses.
yahoo.com
Rising borrowing costs for Spain and Italy and the latest poll showing a lead for Greece's left-leaning, anti-austerity parties ahead of next month's elections added to concerns about the region's economy being enveloped in the debt turmoil.
As crude futures headed for double-digit percentage losses for May, equities and other commodities, like industrial feedstocks platinum and copper, also felt pressure from the worsening expectations for the euro zone economy.
Hopes that China would act to counter slowing growth were dimmed after influential academics said Beijing should shun aggressive fiscal stimulus, in remarks published in leading state-backed newspapers on Wednesday.
Those views joined a chorus of commentary countering market expectations that China might unveil a stimulus package similar to the 4 trillion yuan ($630.1 billion) in spending unleashed during the global financial crisis.
"The European debt crisis and concerns about Chinese economic growth together mean that sentiment is on the very bearish side," said Andy Sommer at EGL in Dietikon, Switzerland. Brent July crude fell $3.28 to $103.40 a barrel at 11:34 a.m. EDT (1534 GMT), having slipped to $103.23.
Brent was on pace to post a monthly loss of more than 13 percent. U.S. July crude slumped $3.10 at $87.66, having fallen to $87.49 as the front-month crude prices headed for a monthly loss of more than 16 percent.
Wednesday's price slide took U.S. crude below the 61.8 percent Fibonacci retracement of the October to March rally at $88.55 a barrel, a key level of support for technical traders.
Pending home sales in the United States fell in April to a four-month low, an unexpected slip, undermining any recent optimism about the housing sector and adding to investor concerns about slowing economies. U.S. stocks on Wall Street fell more than 1 percent, with European equities also posting sharp losses.
yahoo.com
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