Brent steadies under $108; US elections, Greece in focus

Tue Nov 6, 2012 5:03am GMT

By Ramya Venugopal

SINGAPORE (Reuters) - Brent oil traded in a tight range below $108 per barrel on Tuesday, caught between uncertainty ahead of the U.S. elections and renewed worries about Greece and the euro zone crisis, which could delay global economic recovery and hurt oil demand.

President Barack Obama and Republican challenger Mitt Romney were essentially deadlocked on the election eve, polls show, raising concerns of a cliffhanger delaying the outcome and roiling markets, as it did during the extended presidential battle in 2000.

Adding to the worries was news that a deal to keep near-bankrupt Greece afloat may not be reached at a euro zone finance minister's meeting next week.

Front month Brent futures were up 11 cents at $107.84 per barrel by 0339 GMT, trading in a tight 37-cent range so far in the session. Brent rallied nearly 2 percent in the previous session, backed by strength in U.S. gasoline futures.

U.S. crude slipped 4 cents to $85.61 per barrel.

"Trading volumes have been thin as the focus is on the U.S. elections at the moment," said Ker Chung Yang, senior investment analyst at Phillip Futures in Singapore.

The absence of a decisive win and a clear Congress majority raises the chances of messy negotiations over the "fiscal cliff" - nearly $600 billion worth of spending cuts and tax increases that risks pushing the U.S. economy into deep recession, analysts say.

Investors are also monitoring the aftermath of superstorm Sandy on the east coast and the Greek situation, Ker said.   Continued...

An engineer conducts routine checks on oil tanks at a refinery in Wuhan, Hubei province November 27, 2008. REUTERS/Stringer
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