Brent falls to $103 after N Korea leader's death
Singapore, December 19, 2011
Brent crude futures fell below $103 on Monday, as the prospect of rising tension on the Korean peninsula following the death of North Korean leader Kim Jong-il pushed the US dollar higher.
Kim died on a train trip, state television reported on Monday, sparking immediate concern over who is in control of the reclusive state and its nuclear programme.
Brent crude fell 70 cents to $102.65 a barrel by 0407 GMT, after the front-month contract fell 4.85 percent last week, its biggest percentage drop since the week to Nov. 18.
US crude was down 66 cents at $92.87 a barrel. The benchmark lost 5.9 percent in the previous week, its biggest percentage weekly loss since the week to Sept. 23.
'In light of uncertainties about what would follow after his death and what implications it would have on Asia, the initial reaction is to seek safe-haven in the dollar,' said Takao Hattori, an analyst with Mitsubishi UFJ Morgan Stanley Securities in Tokyo.
The greenback rose 0.25 percent against a basket of currencies by 0409 GMT, after trading flat before the news of Kim Jong-il's death emerged.
Lingering concerns over the euro zone debt crisis also weighed on oil prices, but losses were limited by signs China's oil demand would hold up as its economy headed for a moderate slowdown.
Sentiment softened after Fitch Ratings warned on Friday it may downgrade France and six other euro zone countries, saying a comprehensive solution to the region's debt crisis was beyond reach.
Market participants will look to a teleconference of euro zone finance ministers later on Monday for further clarity on plans to deal with the region's sovereign debt crisis. - Reuters