Oil prices sank in Asia today as Euro Zone debt worries rose to the fore once again after Moody’s slashed the ratings and outlooks of key European countries.
New York’s main contract, light sweet crude for delivery in March, fell 25 cents to $100.66 a barrel and Brent North Sea crude for March delivery shed 33 cents to $117.60 on its last trading day.
“The oil market is responding to Moody’s lowering of the debt ratings on a number of European countries,” said Mr Victor Shum, senior principal of Purvin and Gertz energy consultants in Singapore.
“The Euro Zone is back into the picture and that’s causing some selling in oil markets.”
Moody’s yesterday wielded the axe on the debt ratings of Italy, Spain, Portugal, Slovenia, Slovakia and Malta while placing France, Britain and Austria on warning, saying they were increasingly vulnerable to the Euro Zone crisis.
The ratings agency cited the region’s weak economic prospects as threatening “the implementation of domestic austerity programmes and the structural reforms that are needed to promote competitiveness”.