Oil rose in Asian trade Monday but prices were under pressure as investors await further measures by policymakers to boost the ailing eurozone and US economy, analysts said.
New York's main contract, light sweet crude for September delivery was up 46 cents to $90.59 a barrel in the afternoon, while Brent North Sea crude, also for delivery in the same month, was 26 cents higher at $106.73.
German Chancellor Angela Merkel and French President Francois Hollande have vowed to preserve the euro project while investors are cautiously hopeful the US Federal Reserve will unleash a fresh stimulus this week to bolster US growth, analysts said.
“With the main focus this week being the central bank meetings out of Europe and the US, and much QE (quantitative easing) potentially already priced in to the market, there seems to be a fairly large amount of downside risk for most asset classes this week,” said Jason Hughes from IG Markets Singapore.
The European Central Bank's governing council will convene for its regular monthly policy meeting on Thursday under intense glare as investors see if chief Mario Draghi can deliver on this pledge to do “whatever it takes” to save the euro.
“Drahgi has talked big over the last week, but doubt remains over whether he can or will actually deliver,” Hughes said in a market commentary.
“The situation in Spain remains pressured, Greece seems more and more certain to finally default, and the pressure being seen on Italy remains constant and therefore a growing concern.”
For the United States, DBS Bank said that while second quarter economic growth came in better than expected “the message is clear: the US is slowing.” - Sapa-AFP