Oil was little changed in New York after a storm avoided the Gulf of Mexico’s energy-producing area and amid speculation European leaders will fail to stem its debt crisis that threatens to curb fuel demand.
Futures traded below $80 a barrel for a fourth day, near an eight-month low, after Tropical Storm Debby was forecast to bypass the western Gulf and oil companies began returning workers to platforms. Germany’s Chancellor Angela Merkel hardened her resistance to sharing euro-area debt, while HSBC Holdings Plc cut its growth forecast for China, the world’s second-biggest crude user. A government report tomorrow may show U.S. gasoline stockpiles rose for the third time in four weeks.
“Market sentiment remains negative, focusing on slow demand and ample supply,” said Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt. “The supply risk that supported oil is fading as production resumes in the Gulf of Mexico. The looming European Union embargo on Iranian oil may support Brent as it is also affecting oil flows to other nations.”
Oil for August delivery fell as much as 50 cents to $78.71 a barrel in electronic trading on the New York Mercantile Exchange and was at $79.32 as of 11:40 a.m. in London.