U.S. crude oil ended lower for a fourth straight session on Tuesday, as the dollar trended higher against some major currencies and investors keeping a close watch on the Iran nuclear agreement with talks reportedly extended until Friday.
In the event an agreement is reached, it is anticipated that Iran will quickly lift its production and flood global markets with excess oil, creating a supply glut.
The crisis in the eurozone involving Greece has spooked investors and has provided the dollar a big boost, denting most commodity prices.
With its cash running out, Greece is likely to exit the eurozone monetary union upon defaulting on its sovereign debt. Greek voters rejected harsh austerity measures that were once agreed to as part of their rescue plan a few years back.
Greece on Sunday rejected the bailout plan demanded by its international creditors in a referendum, boosting chances of the beleaguered country exiting the Eurozone. The Greek stock market and banks will remain closed until Thursday.
Eurogroup President Jeroen Dijsselbloem, after the first Eurogroup summit meeting on Tuesday, revealed that Greece will make a formal request for financial assistance through the European Stability Mechanism on Wednesday which will be discussed by eurozone finance ministers.
Light Sweet Crude Oil futures for August delivery, the most actively traded contract, fell $0.20 or 0.4 percent, to settle at $52.33 a barrel on the New York Mercantile Exchange Tuesday.
Crude prices for August delivery scaled a high of $53.40 a barrel intraday and a low of $50.58.
On Monday, crude oil prices plunged $4.40 or 7.7 percent, to settle at $52.53 a barrel, on demand growth concerns after Greek voters rejected a bailout proposal from its international creditors, signaling a likely exit from the eurozone.
The dollar index, which tracks the U.S. unit against six major currencies, traded at 96.98 on Tuesday, up from its previous close of 96.25 on Monday in late North American trade. The dollar scaled a high of 97.24 intraday and a low of 96.31.
The euro trended lower against the dollar at $1.0963 on Tuesday, as compared to its previous close of $1.1056 in North American trade late Monday. The euro scaled a high of $1.1060 intraday and a low of $1.0917.
In economic news, a Commerce Department report on Tuesday showed U.S. trade deficit to have widened in May, with the value of exports falling much more than the value of imports. U.S. trade deficit widened to $41.9 billion in May from a revised $40.7 billion in April. Economists expected the deficit to widen to $42.7 billion.
From Europe, Germany’s industrial production remained unchanged in May from the prior month, Destatis reported Tuesday. Production was forecast to rise 0.1 percent after expanding 0.6 percent in April, which was revised down from 0.9 percent.
The French trade deficit increased in May due to a fall in exports amid increasing imports, the customs office reported Tuesday. The trade deficit widened to EUR 4.02 billion in May from EUR 3.3 billion in April. It was larger the expected shortfall of EUR 3.6 billion.
U.K industrial output expanded unexpectedly in May on strong oil and gas production, figures from the Office for National Statistics showed Tuesday. Industrial production rose 0.4 percent month-over-month in May, defying economists’ expectations for a 0.2 percent fall. It was the fourth consecutive monthly gain.
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