Crude oil fell for the first time in three days after the European Union said Greece’s budget deficit last year was worse than previously forecast, sending equities and the euro lower. Oil slipped as much as 2.3 percent in New York after the U.S. currency’s gain dimmed the appeal of commodities as an alternative investment. An Energy Department report yesterday showed that U.S. crude and fuel supplies increased last week as demand slipped in the world’s largest energy consuming country.
“The stuff out of Europe doesn’t get any better,” said Bill O’Grady, chief market strategist at Confluence Investment Management in St. Louis. “The problems out of Europe continue to impact the dollar and raise concerns about economic growth.” Crude oil for June delivery dropped 95 cents, or 1.1 percent, to $82.73 a barrel at 11:50 a.m. on the New York Mercantile Exchange. Futures are up 4.2 percent this year. The EU’s statistics office said Greece’s deficit was 13.6 percent of GDP last year, topping the government’s two week old forecast of 12.9 percent. Greece’s widening deficit and questions about the accuracy of its economic data have undermined the credibility of the EU’s budget rules and contributed to the 7.2 percent slide in the euro this year.
The dollar traded at $1.3293 against the European currency, up 0.7 percent from yesterday. It was the greenback’s sixth straight increase. The Standard & Poor’s 500 Index slid 1 percent to 1,193.98. The Energy Department’s report showed crude oil stockpiles in the U.S. increased by 1.89 million barrels in the week ended April 16. Gasoline supplies rose 3.59 million barrels to 224.9 million, and inventories of distillate fuel, a category that includes heating oil and diesel, gained 2.1 million barrels to 148.9 million.....Read the entire article.
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