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Crude headed for a second weekly loss in New York as concern that Europe’s worsening debt crisis will trigger a recession outweighed political tensions in oil- producing Middle East nations.
Futures have lost 2.3 percent this week as Portugal and Hungary’s credit ratings were cut and Germany again ruled out joint euro-area borrowing and an expanded role for the European Central Bank in fighting the turmoil. Prices may jump amid France’s call for an embargo on crude exports from Iran, according to Mirae Asset Securities Ltd. Four people died in clashes this week between Shiite Muslims and Saudi security forces in the oil-rich Eastern Province.
Crude for January delivery fell to as low as $94.99 a barrel in electronic trading on the New York Mercantile Exchange, its lowest since Nov. 9. It was at $95.18 at 1:06 p.m. in London, down 1 percent from the settlement on Nov. 23. Floor trading was closed yesterday for the U.S. Thanksgiving Day holiday and electronic trades will be booked with today’s transactions for settlement purposes.
Brent oil for January settlement on the London-based ICE Futures Europe exchange dropped as much as 1.6 percent, or $1.70, to $106.08 a barrel. Prices are down 1.2 percent this week. The European benchmark was at a premium of $11.07 to New York-traded West Texas Intermediate futures. The spread reached a record $27.88 on Oct. 14.
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