Oil down in Asia on US fiscal cliff worries

Gas prices are seen over $4.00 a gallon, Thursday, Oct. 4, 2012 in Twin Mountain, N.H. FILE PHOTO

SINGAPORE – Oil prices were lower in quiet Christmas eve trade Monday with traders discouraged by a political stalemate in the US over a deal to avert the fiscal cliff, analysts said.

New York’s main contract, light sweet crude for delivery in February shed 16 cents to $88.50 and Brent North Sea crude for February delivery fell eight cents to $108.89.

Political bickering over a deal to avert the fiscal cliff weighed on markets in a “relatively quiet session” before the Christmas holiday, said Jason Hughes, head of premium client management for IG Markets Singapore.

“We’ve still got concerns over where we stand in the fiscal cliff… that remains a concern that keeps traders cautious,” he told AFP.

Democratic and Republican leaders broke for the Christmas holiday on Saturday blaming each other for stonewalling a deal to prevent the US from tipping over the fiscal cliff by the end of the year.

Both sides had in the run up to Christmas rejected each others’ proposals to avert a series of tax hikes and spending cuts slated to take effect in January that could push the world’s biggest economy and oil consumer back into recession.