Oil resilient despite European debt crisis

29 April 2010

Written by John King

Crude oil prices closed higher yesterday (April 28th) despite mounting concerns that Greece's debt crisis could spread throughout Europe.

Spain and Portugal both saw their debt ratings downgraded following Moody's decision earlier in the week to demote Greece's rating to junk status.

Clarence Chu, an energy trader at Hudson Capital Energy in Singapore, warned Reuters that "the market is too optimistic about the whole situation".

Support for crude and heating oil came from Federal Reserve chairman Ben Bernanke's reassurance that the central banks would remain committed to its pledge to keep interest rates low for an "extended period", while signs of strengthening oil demand also bolstered prices.

Oil closed for the day at $83.22 a barrel, up 78 cents, but has retreated in trading this morning, losing around 15 cents by the time European markets opened.

Heating oil prices also traded in line with crude futures, closing up for the day yesterday but slipping this morning.

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