Crude turns down in Asia on Spain worries

October 02, 2012 | 14:36

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Crude oil prices turned lower in Asia Tuesday with dealers waiting to see if Spain will ask for a bailout as worries grow about its economy, analysts said.

New York's main contract, light sweet crude for delivery in November, fell 13 cents to $92.35 a barrel and Brent North Sea crude for November delivery shed nine cents to $112.10.

"Oil is edging down some... The bearish factor really comes from Europe, it's the eurozone debt crisis again and this time its really about Spain," said Victor Shum, senior principal of Purvin and Gertz energy consultants in Singapore.

"Spain is reportedly ready to ask for a bailout from the eurozone and so Spain looks to be another Greece emerging," he told AFP.

In the past week, Spain has unveiled an austerity budget for 2013 while a report said it would need less cash than expected to save its banks.

Spain revealed Saturday that the cost of a banking bailout will send its debt soaring to 85.3 percent of gross domestic product in 2012 and 90.5 percent next year.

The Bank of Spain said last week the recession deepened in the third quarter. And Madrid's forecast for an economic contraction of just 0.5 percent next year has been met with deep scepticism on the market.

The Spain issue will likely be on the agenda when eurozone finance ministers meet on October 8 and at a European Union summit in October 18-19.

AFP

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