The prices of Oil rises above $99 on Monday in Asia after approval of new austerity measures by Greek parliament to secure a second bailout and stay away from bankruptcy. Not only oil prices but also many different parts of financial market including Asian shares and base metals to gold have also increased.
This Greek law would pave the way for the European partners of Greece and the International Monetary Fund to release $170 billion (€130 billion) in new rescue measures. Without the bailout, Greece would have to leave the euro zone after not getting defaulted position on its debt next month. The country needs internationals funds before March 20 to meet 14.5 billion euros of debt repayments.
Brent crude increased to $117.60, i.e. up 85 cents, per barrel on the ICE Futures Exchange in London.
Benchmark crude for March delivery went up by 58 cents at $99.25 per barrel at midmorning Singapore time in electronic trading on the New York Mercantile Exchange. The contract fell $1.17 to settle at $98.67 on Friday.
Oil prices moved around $100 for some of the previous months after signs of improving U.S. economy. However, Thomson Reuters/University of Michigan surveys of consumer confidence, which become higher in January as a result of Job Gains, also declined in February and some experts are reporting that the decrease of consumer confidence is the result of increased gasoline prices.
“The problem is that gasoline prices have recently jumped and this appears to have more than offset the positive developments,” Capital Economics said in a report. According to some experts, prices would be lowered this year in the face of weak global economic growth. The International News Agency (IEA) has reported this Friday that global oil demand will probably grow by less than 1% this year.
“To be bullish from here, one would need to believe a supply disruption is coming,” Morgan Stanley said in a report. “With fundamentals weakening, we believe that any further upside is unlikely without a supply shock.”