Oil prices fall on Monday as worries over North America oversupply dragged, and accordingly Brent futures also decreased below $60 a barrel and U.S. contracts hovering around $50.30.
Prices began dipping as analysts said crude markets remained oversupplied after the rise in global markets and euro zone crisis over Greek debt had been averted for now.
ANZ Bank said in a note on Monday” We expect oil’s rally to peter out as weakening fundamentals overwhelm the recent rally.” Barclays also said” Near-term topping signals for WTI crude oil endorse our expectation of further choppy consolidation. A move below nearby support in the $48.20 area would signal a squeeze towards the range lows at $44.37 where we would look for signs of a base.”
Analysts said that a cold spell in the United States, which has hit refinery output, could also prevent crude prices from rising further. Major U.S. East Coast refineries have been hit by cold weather, sending up heating oil futures on fears of tight supplies.
U.S. government commented Sunday on the sharp fall in oil revenue which forced Colombia to delay $2.44 billion in spending. Accordingly, the government released a statement to confirm that the the cabinet approved which consist of of 4.8 trillion pesos ($1.95 billion) in investments and 1.2 trillion ($488 million) in administrative costs and it added the move takes into account “new macroeconomic and fiscal conditions, associated primarily with the fall in international oil prices.”