Crude up in Asia on bargain-hunting

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Crude prices bounced on bargain-hunting in Asia Thursday after suffering big losses in New York where dealers were spooked by concerns over the US “fiscal cliff” and European debt, analysts said. New York’s main contract, light sweet crude for delivery in December, added 55 cents to $84.99 a barrel in the afternoon and Brent North Sea crude for December gained 68 cents to $107.50.
“We had quite a large move down (Wednesday) as the worries over the fiscal cliff and European woes started to more than usurp the euphoria” over the re-election of President Barack Obama, Jason Hughes, head of premium client management for IG Markets Singapore told AFP. “In Asian trade prices have pushed back up… it’s probably people covering positions after a big move.”
After Obama’s victory over Republican Mitt Romney the focus turned to the US fiscal cliff, a combination of deep spending cuts and huge tax hikes to take effect on January 1.
The package is a major threat to the economy that investors warn could tip the world’s number one economy back into recession if lawmakers do not agree a less deal to slash the country’s debt.
Sentiment has also been pressured after the European Union cut its eurozone economic forecast and European Central Bank chief Mario Draghi issued a warning over the currency bloc’s woes. “Unemployment is deplorably high, overall economic activity is weak and it is expected to remain weak in the near term,” Draghi told a banking conference in Frankfurt on Wednesday.