Oil falls below $110 on euro zone crisis

Thursday, 27 September 2012 03:25 - - {{hitsCtrl.values.hits}}

Reuters: Brent crude oil fell more than $1 per barrel to below $110 on Wednesday, weighed down by a stronger dollar, worries over growth and the euro zone debt crisis as Greece faced its biggest anti-austerity strike for months.

Greece’s transport system ground to a halt, shops pulled down their shutters and hospitals worked on emergency staff on Wednesday as the country’s two biggest unions protested against a new round of belt-tightening.

The strike followed violent protests in Spain, reigniting worries that the euro zone debt crisis is deepening despite efforts by central banks to reflate their economies.

A stronger dollar and a weaker euro also depressed oil after the Bank of Spain said Spain’s gross domestic product fell at a “significant rate” in the third quarter.

North Sea Brent crude oil futures fell $1.04 to a low of $109.41 before recovering to trade around $109.60 by 4.50 a.m. EDT. U.S. light crude oil futures also fell sharply, dropping to an intra-day low of $90.33, down $1.04.

Crude futures surrendered gains made earlier this month when both contracts reached four-month highs on a commodity-wide rally fed by stimulus measures by U.S. and EU central banks.