Brent crude fell for the second time in three days amid concern that deadlock in U.S. budget talks may threaten to curb economic growth and fuel demand.
The North Sea benchmark fell as much as 45 cents on the ICE Futures Europe Exchange, reversing earlier gains. European stocks declined for a third day on concern U.S. lawmakers won’t agree to a budget before more than $600 billion in tax increases and spending cuts known as the fiscal cliff start taking effect in January. The Stoxx Europe 600 (SXXP) fell 0.3 percent to 278.65. Indexes in the U.K., Germany and France dropped.
“We are down with equity markets,” Andrey Kryuchenkov, an analyst at VTB Capital in London said in an e-mailed response to questions. “All will look to the fiscal cliff debate in the U.S. congress before the year’s end.”
Brent for February settlement fell 29 cents, or 0.3 percent, to $107.89 a barrel on the London-based ICE Futures Europe exchange. The January contract settled $1.24 higher at $109.15 when it expired Dec. 14. The European grade was at a premium of $20.73 to WTI, down from $22.42 on Dec. 14.
West Texas Intermediate crude for January delivery was at $86.68 a barrel, down 5 cents, in electronic trading on the New York Mercantile Exchange at 9:31 a.m. London time. Front-month prices advanced 0.9 percent for the week ended Dec. 14.
