Crude was mixed in the Asian trade today ahead of a crunch European Union summit as doubts lingered over whether leaders can come up with a solution to the euro zone debt crisis, analysts said.
New York’s main contract, light sweet crude for delivery in January, fell three cents to $100.46 a barrel. Brent North Sea crude for January delivery gained 16 cents to $109.69.
Oil prices were curtailed by “diminished expectations for the upcoming EU summit,” said Mr Sanjeev Gupta, head of Ernst & Young’s Asia-Pacific oil and gas practice in Singapore.
European leaders were to meet in Brussels later in the day for a two-day summit centered on finding a lasting solution to the region’s debt crisis, which has dragged down global markets for months.
Despite worries over the euro zone’s fate, crude prices were being supported by calls for Europe to hold back from imposing an embargo on Iranian oil, Mr Gupta said.
“There are some underlying concerns around European proposals to ban the sales of Iranian oil into Europe, concerns that are likely to backstop further price weakness to some extent,” he said.
The Organisation of Petroleum Exporting Countries (OPEC) Secretary General, Mr Abdullah El-Badri, expressed hope yesterday that the EU would refrain from sanctions on Iranian oil exports.
Iran is one of OPEC’s major members and exports 865,000 barrels a day to the whole of Europe. An abrupt EU embargo would cause prices to drop due to temporary oversupply until Tehran could find other buyers.