Oil prices fall on Greek debt jitters, stronger US dollar
Oil prices dropped this afternoon after the Greek government's decision to hold a referendum to approve the latest aid package for Greece spooked investors, jeopardising last week's plan to resolve the debt crisis agreed by the EU.
Traders are worries that Greek voters will reject a new round of austerity measures and the debt plan will fall through, triggering another financial meltdown in Europe and reducing energy demand.
Likewise, today's US data disappointed, showing that growth in construction spending and manufacturing activity slowed.
The Institute for Supply Management's (ISM) said its manufacturing index declined from 51.6 in September to 50.8 last month - still indicating growth but at a slower pace than in the previous month.
Meanwhile, the Commerce Department said construction spending rose 0.2 percent in September, which, however, was below the projected 0.3 percent increase.
Movements in foreign exchange markets have also been unfavourable for oil futures as yesterday's decision by the Bank of Japan to sell the yen and concerns over the euro zone debt crisis have sent the US dollar flying, denting demand for the dollar-denominated crude.
US light, sweet crude for December delivery, currently the most actively traded contract on the New York Mercantile Exchange (NYMEX), dropped US$2.60 to US$90.59/barrel in morning trade in New York.
December Brent crude fell US$2.25 to US$107.14/barrel on the ICE Exchange this afternoon.
Today's top risers in the oil and gas sector were:
Woburn Energy (LON:WBN), up 16 percent at 1.85 pence at midday
Sterling Energy (LON:SEY), up 7.5 percent at 43.5 pence
Aurelian Oil & Gas (LON:AUL), up 4 percent at 20 pence
Trap Oil (LON:TRAP), up 2.5 percent at 28.45 pence
Egdon Resources (LON:EDR), up 2 percent at 13.1 pence
The top fallers were:
Sefton Resources (LON:SER), down 15 percent at 2.95 pence at midday
Caza Oil & Gas (LON:CAZA), down 11.5 percent at 12.59 pence
Circle Oil (LON:COP), down 9.5 percent at 24.6 pence
Cadogan Petroleum (LON:CAD), down 9 percent at 38.75 pence
Antrim Energy (LON:AEY), down 8.5 percent at 61.24 pence
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