Crude oil down again on Europe concerns

17 May 2010

Written by Kim Bardsley

Crude oil prices began the week by extending losses for a fifth consecutive day, with Europe causing further anxiety on trading floors.

During the electronic trading session of the New York Mercantile Exchange, the dollar dropped sharply and was teetering above $70 (£48) as European markets opened.

Speaking to Bloomberg, Victor Shum, a senior principal with US energy consultants Purvin & Gertz in Singapore, said that the debt crisis has brought home the realities of oil's week fundamentals.

"As long as the US dollar remains strong and the euro concerns remain intact, there's going to be a lot of downward pressure on oil," he said.

Elsewhere, Uwe Parpart, chief Asia strategist at Cantor Fitzgerald, told Market Watch that the euro may not be around too much longer.

The analyst predicted that the single currency will hit parity with the dollar by the end of the year before "disintegrating" in 2011.