On the New York Mercantile Exchange, light, sweet crude futures for delivery in February CLG5, -3.23% declined $1, or 1.8%, to trade at $54.73 a barrel at last check in the Globex electronic session. Earlier, the contract traded as high as $55.74, 1.8% higher than Friday’s settlement.
February Brent crude on London’s ICE Futures exchange LCOG5, -3.33% fell $1.21, or 2.1%, to $58.24 a barrel.
Nymex crude lost 4.2% last week, and Brent crude was down by 3.1% on the week. Both the oil benchmarks have fallen for five consecutive weeks.
“With persisting conflicts in Libya, crude export and production continue to be unstable. Current estimates of crude output in Libya stands at 352,000 barrels a day,” analyst Daniel Ang at Singapore’s Phillip Futures said.
He said that for the past week both Nymex WTI and Brent crude were supported by short covering but that, with 2015 just around the corner, support levels are waning.
The lack of follow-through from the bump in prices Monday is indicative of the bearishness that has established itself in oil markets, said Phil Flynn, senior market analyst at Price Futures Group in Chicago. “They didn’t burn enough oil,” Flynn said. “That’s the mind set.”
Flynn said even with prolonged violence in Libya, there are many OPEC producers that could fill the void, and reports of oil going into storage that could come on the market later.
“It’s all cementing bearish momentum in the short term,” Flynn said.
“We expect both WTI and Brent to continue to trade range bound,” Phillip Futures’s Ang said, adding that toward the end of the week traders may start resuming their short positions, pushing prices down further.
Similarly, gasoline futures swung to a loss. Nymex reformulated gasoline blendstock for January RBF5, -3.76% — the benchmark gasoline contract — fell 4 cents, or 2.5%, to $1.47 a gallon.
