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Oil Prices Debt Talks

July 25, 2011 by staff 

Oil Prices Debt TalksOil Prices Debt Talks, Oil prices fell to near 99 and a barrel Monday in Asia amid investor concerns that the lack of an agreement between U.S. lawmakers to increase debt limit of the country could trigger a default and damage to the global economy. Reference oil for September delivery fell 81 cents to 99.06 a barrel and in the afternoon in Singapore in electronic trading on the New York Mercantile Exchange. Crude rose 74 cents to settle at 99.87 and Friday.

In London, Brent crude fell 60 cents to 118.07 and the barrel on the ICE Futures exchange.

Talks stalled over the weekend as August 2 deadline looms for Congress to raise the government and 14.3-trillion debt limit. Without action by that date, the Treasury cannot pay all your bills, which could lead to defaults and undermine the global economy.

Republican and Democratic leaders plan to introduce government spending and debt proposals Monday afternoon.

“We believe that an interim agreement was reached last minute, to avoid the worst outcomes,”said Bank of America Merrill Lynch in a report.” It will not be able to offer a credible long-term solution or tax increase rating agency concerns. ”

Bank of America said the rating agency’s credit rating is likely to reduce U.S. to AA from AAA by the end of the year.

In other Nymex trading in contracts for September, heating oil fell 2.0 cents to 3.12 and a gallon while gasoline fell 1.5 cents to 3.08 and a gallon. Natural gas for August delivery advanced 1.5 cents to 4.41 and per 1,000 cubic feet.

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