Investing.com - Crude oil futures were mildly lower during European morning trade on Thursday, as uncertainty over the outcome of a Spanish government debt auction later in the day prompted investors to stick to the sidelines.
Prices remained supported near the previous session’s highs amid growing hopes for further easing measures by the Federal Reserve as well as renewed concerns over a disruption to Iranian oil supplies.
On the New York Mercantile Exchange, light sweet crude futures for delivery in July traded at USD84.73 a barrel during European morning trade, dipping 0.35%.
The July contract traded in between a tight range of USD85.71, the daily high and a session low of USD84.75. Prices touched a four-day high of USD86.26 on Wednesday.
Markets were awaiting the outcome of a highly-anticipated Spanish 10-year bond auction later in the day, after Treasury Minister Cristobal Montoro said that financial markets were effectively closed to Spain because of the current high level of the country’s borrowing costs.
Concerns about Spain’s banks have grown since Bankia, the country’s fourth-largest lender, said last month it needed EUR19 billion in state aid to shore itself up against bad loans.
There are worries that the region’s worsening sovereign debt crisis could trigger a broader economic slowdown that would curb demand for oil.
But prices remained supported amid growing speculation the Federal Reserve will consider more action to stimulate growth in the U.S.
Hopes for such action were lifted by comments from Fed Vice chair Janet Yellen, who said in a speech Wednesday that the central bank could further ease monetary conditions in response to ongoing housing problems, a weak jobs market and the escalating euro zone crisis.
Her comments came after Atlanta Federal Reserve President Dennis Lockhart said that sustained weakness in the job market could justify more action to support the economic recovery.
Attention now shifts to a Congressional testimony by Federal Reserve Chairman Ben Bernanke later in the day about the state of the U.S. economy. Traders will be looking for any hints that the Fed is considering more monetary stimulus.
The Wall Street Journal, citing interviews and Fed speeches, reported late Tuesday that the Fed was mulling new measures to stimulate growth in the world’s largest economy.
Meanwhile, a warning from Iran over talks about its nuclear program that are scheduled for later this month provided further support.
The nation’s envoy to the International Atomic Energy Agency said Wednesday that Iran will “never suspend” its enrichment of uranium and “will not permit our national security to be jeopardized”.
The comments come ahead of talks scheduled for June 18 and 19 in Moscow between Iran and Western powers.
Iran and Western nations have been locked in an ongoing stand-off over Tehran's nuclear program.
The U.S. and its allies worry the program is aimed at developing a nuclear weapon, and have stepped up sanctions against the country in recent months, including a European oil-import ban set to take effect on July 1.
Iran produces about 3.5 million barrels of oil a day, making it the second-largest oil producer in the Organization of Petroleum Exporting Countries.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for July delivery was down 0.55% to trade at 100.09 a barrel, with the spread between the Brent and crude contracts standing at USD15.36.
Prices remained supported near the previous session’s highs amid growing hopes for further easing measures by the Federal Reserve as well as renewed concerns over a disruption to Iranian oil supplies.
On the New York Mercantile Exchange, light sweet crude futures for delivery in July traded at USD84.73 a barrel during European morning trade, dipping 0.35%.
The July contract traded in between a tight range of USD85.71, the daily high and a session low of USD84.75. Prices touched a four-day high of USD86.26 on Wednesday.
Markets were awaiting the outcome of a highly-anticipated Spanish 10-year bond auction later in the day, after Treasury Minister Cristobal Montoro said that financial markets were effectively closed to Spain because of the current high level of the country’s borrowing costs.
Concerns about Spain’s banks have grown since Bankia, the country’s fourth-largest lender, said last month it needed EUR19 billion in state aid to shore itself up against bad loans.
There are worries that the region’s worsening sovereign debt crisis could trigger a broader economic slowdown that would curb demand for oil.
But prices remained supported amid growing speculation the Federal Reserve will consider more action to stimulate growth in the U.S.
Hopes for such action were lifted by comments from Fed Vice chair Janet Yellen, who said in a speech Wednesday that the central bank could further ease monetary conditions in response to ongoing housing problems, a weak jobs market and the escalating euro zone crisis.
Her comments came after Atlanta Federal Reserve President Dennis Lockhart said that sustained weakness in the job market could justify more action to support the economic recovery.
Attention now shifts to a Congressional testimony by Federal Reserve Chairman Ben Bernanke later in the day about the state of the U.S. economy. Traders will be looking for any hints that the Fed is considering more monetary stimulus.
The Wall Street Journal, citing interviews and Fed speeches, reported late Tuesday that the Fed was mulling new measures to stimulate growth in the world’s largest economy.
Meanwhile, a warning from Iran over talks about its nuclear program that are scheduled for later this month provided further support.
The nation’s envoy to the International Atomic Energy Agency said Wednesday that Iran will “never suspend” its enrichment of uranium and “will not permit our national security to be jeopardized”.
The comments come ahead of talks scheduled for June 18 and 19 in Moscow between Iran and Western powers.
Iran and Western nations have been locked in an ongoing stand-off over Tehran's nuclear program.
The U.S. and its allies worry the program is aimed at developing a nuclear weapon, and have stepped up sanctions against the country in recent months, including a European oil-import ban set to take effect on July 1.
Iran produces about 3.5 million barrels of oil a day, making it the second-largest oil producer in the Organization of Petroleum Exporting Countries.
Elsewhere, on the ICE Futures Exchange, Brent oil futures for July delivery was down 0.55% to trade at 100.09 a barrel, with the spread between the Brent and crude contracts standing at USD15.36.