Oil Falls as Global Equities Continue Decline on Euro Zone Worries


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Oil is falling in early morning trade as stocks worldwide continue to decline on prevailing worries about the euro zone's economic outlook. The euro's drop against the greenback reflected such concerns, and anxiety about Europe's financial footing is putting a damper on global growth prospects, pushing back energy demand.

Investors are turning to the U.S. dollar as they sell off commodities, including oil as concerns about the contagion effect of Europe's sovereign debt show no signs of abating.

At 0750 ET, Brent crude is down 2.3% at $72.01 a barrel, while light sweet crude is 1.5% lower at $68.80 a barrel, and natural gas is up 0.5% at $4.18 a million British thermal units.

On the corporate front, Finland's Fortum said it would like to acquire Russian power generation assets or make an asset swap. The deputy head of the group's Russian unit, Roman Zorabyants, did not, however, provide further details to reporters.

"We are prepapring a portfolio of assets we might be interested in but are not holding any talks for now," Zorabyants said, but added that the assets the company was eyeing were in locations where Fortnum was already present.

Peabody Energy Corp. ( BTU ) failed to buy out Australia's Macarthur Coal Ltd ( MCC ), but it continues to look for deals in Australia as coal demand booms and the country is strategically located to Asia, according to Reuters.

On Capitol Hill, a Senate appropriations subcommittee will be holding a hearing on mining safety. The chairman of Maasey Energy Co. ( MEE ) Don Blankenship will be among those called to testify after an accident at the company's Upper Big Branch mine in West Virginia led 29 workers to die.

Meanwhile, the Web site operated by credit rating agency Moody's released a report stating that the Gulf of Mexico oil spill by BP plc ( BP ) will not have a major impact on the U.S. economy. Economy.com argued that while businesses in Louisiana, Mississippi, Alabama, and Florida have been hurt by the rig explosion that led to the spill, thos eplass represent only 1% of GDP, "so broad macroeconomic effects are unlikely, at least in the near term."

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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This article appears in: Investing , Commodities
More Headlines for: BP , BTU , MCC , MEE

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