Oil lower on concerns over US and eurozone

SINGAPORE - Agence France-Presse

AP photo

Oil prices edged lower in Asia Monday, with investors fretting over stuttering growth in the US economy while political and economic uncertainty in the eurozone also weighed, analysts said.
 
New York's main contract, West Texas Intermediate crude for delivery in June was down 10 cents to $104.83 per barrel while Brent North Sea crude for June shed 24 cents to $119.59 in the afternoon. Economic growth in the US slowed sharply to 2.2 percent in the first quarter of 2012, official data showed Friday, rekindling concerns that the nascent recovery in the world's top oil consumer was losing steam.
 
The dip in growth from January to March was largely attributed to a slump in government spending.
 
"For all intents and purposes, consumption (in the US) remains in the doghouse. For the record, headline GDP growth of 2.2 percent drops to 1.5 percent if you take autos out of the equation," DBS Group Research said in a note.
 
Meanwhile, investors continue to fret over the possibility of another debt crisis in the eurozone, with the European Central Bank set to huddle Thursday for its crucial monthly policy-setting meeting.
 
Since the last meeting in April, worries over sovereign debt have gained steam, with Spain now in focus as unemployment soars and public debt bulges while it was also hit with a ratings downgrade.
 
On the political front, Socialist challenger Francois Hollande looks likely to edge out French president Nicolas Sarkozy in a May 6 election run-off, while polls are also looming in crisis-hit Greece, which crucially needs to reboot its economy with tax cuts and amend an EU-IMF recovery plan.
 
"This weekend's Greek elections will be a reminder of the challenges faced by politicians against voters who want to relax austerity measures tied to the bailout programmes," said DBS Group Research.