Brent crude rises on supply concerns
Financeroll – Brent crude futures rose above $104 on Friday on worries about supply disruption after the U.S. Congress approved a bill imposing sanctions on Iran's central bank, limiting buyers' ability to pay for oil they buy from the Islamic Republic.
Yet gains were capped on fears Europe's debt crisis would worsen as the region's leaders struggle to get their respective parliaments to agree to austerity measures. Investors are worried further delays may engulf the world's growth engines, with signs already emerging of China feeling the heat.
Brent crude, which rolled over to February as the prompt month, rose 45 cents to $104.05 a barrel by 0801 GMT, ending two days of fall. U.S. crude rose 10 cents to $93.97 a barrel, after falling $1.08 to settle at $93.87. Brent is set to decline 4.3 percent this week, its biggest drop since the week ended November 20, while the U.S. benchmark is set to slip 5.5 percent, its biggest fall since the week ended September 25.
Oil markets took wide swings this week, jumping more than 2 percent on Tuesday on jitters over Iran supplies and threats to key shipping lanes, pushing Brent to a high of $111.10. Prices plunged more than 4 percent the next day in a broad commodities selloff triggered by concerns over Europe.
The dollar index slipped 0.12 percent after rising for most of the week as the euro slumped and sliding to an 11-month low. A decline in the greenback typically boosts commodities like oil priced in the dollar. The U.S. Congress on Thursday approved a defense bill that imposes sanctions on Iran's central bank, sending it to President Barack Obama for his expected signature into law.
Plans for fresh U.S. sanctions to isolate Tehran have sent shudders among Asian governments who fear they will have no way to pay for Iranian crude imports and face rising costs to fuel the region's growing economies. [RTR/FR]
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