AP FILE PHOTO
NEW YORK – Oil prices Monday gave back some of last week’s gains, declining at the start of a holiday-shortened week.
US benchmark West Texas Intermediate for delivery in February fell 41 cents to $98.91 a barrel.
European benchmark Brent oil for delivery in February declined 21 cents to $111.56 a barrel.
US oil prices rose 2.8 percent last week on improving economic data in the US and the continuation of a months-long blockade of critical oil-exporting terminals in Libya.
“We had a big rally last week,” said Andy Lebow, senior vice president for energy derivatives at Jefferies Bache. “We’re giving some back in light volumes.”
Many traders were on vacation Monday, owing to the Christmas holiday, which will close the US market early on Tuesday and all of Wednesday. Trading volumes in WTI were 62 percent below average on Monday afternoon, Lebow said.
Analysts said the sentiment towards crude remains fairly positive given the expectation of better demand with the improving economy and the disruption in Libya.
In recent days, the market has also begun to fixate on South Sudan, where fighting has intensified over the last week in a conflict with both ethnic and political dimensions.
The UN Security Council will hold emergency consultations on the situation in South Sudan later Monday, the French mission to the world body said.
Oil companies have evacuated employees after the death of at least five South Sudanese oil workers last week.
On Sunday, Mayen Dut, South Sudan’s Ambassador to Sudan, told AFP that oil production had not been affected by the strife.
The South Sudan situation “does underline there are a lot of political pressures at play,” said Carl Larry, president of Oil Outlooks and Opinions, a consultancy.
“Nothing ever settles,” Larry said. “We are never at a peaceful time.”