Fin24

Oil mixed ahead of EU summit

2011-12-08 07:59

Singapore - Crude was mixed in Asian trade on Thursday ahead of a crunch European Union summit as doubts lingered over whether leaders can come up with a solution to the eurozone 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 Sanjeev Gupta, head of Ernst & Young's Asia-Pacific oil and gas practice in Singapore.

European leaders were to meet in Brussels later on Thursday for a two-day summit centred on finding a lasting solution to the region's debt crisis, which has dragged down global markets for months.

Despite worries over the eurozone's fate, crude prices were being supported by calls for Europe to hold back from imposing an embargo on Iranian oil, Gupta said.

"There are some underlying concerns around European proposals to ban sales of Iranian oil into Europe, concerns that are likely to backstop further price weakness to some extent," he said.

Organisation of Petroleum Exporting Countries (Opec) Secretary General Abdullah El-Badri expressed hope on Wednesday 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.