Brent crude fell for a second day amid speculation that the biggest weekly rally since February on tension between Ukraine and Russia may be excessive. West Texas Intermediate was steady.
Futures dropped as much as 0.6 percent in London. The U.S. and its European allies urged Russia to help calm the Ukraine crisis after four-party talks produced an accord aimed at easing the worst standoff with Russia’s government since the Cold War. WTI’s discount to Brent shrank as President Barack Obama’s administration said it will postpone a ruling on the Keystone XL pipeline that would bring Canadian crude south to the U.S.
“The reaction in the market was overdone,” Tom James, managing director at consultancy Navitas Resources, said by phone from Dubai today. “The last thing Russia will do is to cut exports. The Ukraine tension is hyped up, but if I ask what the market is looking at, it is clearly monitoring that situation.”
Brent for June settlement declined as much as 64 cents to $108.89 a barrel on the London-based ICE Futures Europe exchange and was at $109.27 at 1:52 p.m. in London. The front-month contract rose 2.1 percent last week, the most since Feb. 7. The volume of all futures traded was about 74 percent below the 100-day average. Prices are down 1.4 percent this year.
West Texas Intermediate for May delivery, which expires tomorrow, decreased 17 cents to $104.13 a barrel in electronic trading on the New York Mercantile Exchange. The more-active June future was 12 cents lower at $103.25. Trading on both Nymex and ICE was closed on April 18 for the Good Friday holiday.
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