Brent falls towards $93 on euro zone

Thu Jun 28, 2012 7:28am EDT
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By Christopher Johnson

LONDON (Reuters) - Brent crude oil slipped to around $93 per barrel on Thursday as worries a deepening euro zone crisis would curb economic growth and energy demand outweighed a cut in Norwegian oil output.

EU leaders meet in Brussels on Thursday openly divided, with German Chancellor Angela Merkel pitting herself against France and Italy, insisting they put the bloc's fundamental problems ahead of emergency action.

Analysts say the euro zone debt and financial crisis is stifling activity in the region, eroding investor confidence and dampening economic growth in other parts of the world.

A cut in Norwegian production due to a strike by oil workers has tightened the supply balance in the North Sea, adding some positive sentiment to the crude market, traders said.

Brent crude oil futures for August fell $1.03 to a low of $92.47 per barrel before recovering to trade around $93.15 by 0715 EDT. The Brent contract settled at $93.50 on Wednesday, the highest in just over a week. U.S. crude futures fell 10 cents to $80.11.

"The Norwegian strike is lending some support, at least at the moment, but market sentiment is very negative," said Carsten Fritsch, commodities analyst at Commerzbank in Frankfurt.

"There are concerns that the EU summit will disappoint."

STRIKE   Continued...