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Oil prices fall after attacks on Brussels

Europe already pressured economically by the consequences of lower oil prices.
By Daniel J. Graeber Follow @dan_graeber Contact the Author   |   March 22, 2016 at 9:55 AM
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NEW YORK, March 22 (UPI) -- Economic growth concerns added to pressure from attacks on the European capital to push crude oil prices into negative territory in early Tuesday trading.

More than 100 people were injured and at least 26 people were killed in a suicide terrorist attack on an airport and metro station in the Belgian capital. The U.S. Embassy in Brussels issued a shelter-in-place advisory, warning the threat level was serious.

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Dutch Prime Minister Mark Rutte, who holds the rotating presidency of the European Council, described Tuesday's attacks as cowardly.

"While many things are still unclear, it's certain that special vigilance is needed now, not only in Belgium but also in our own country," he said in a statement. "We will take all necessary precautions."

Crude oil prices, which had rallied on word of forward economic momentum and supply-side pressures, moved lower following word of the attacks. Brent crude oil was down 0.6 percent minutes before the start of trading in New York to $41.29 per barrel. West Texas Intermediate, the U.S. benchmark price for crude oil, was down 0.75 percent to $41.21 per barrel.

The attacks in Brussels followed the arrest last week in the Belgian capital of Salah Abdeslam, one of the suspects tied to last year's terrorist raids in Paris, and came as Europe as a whole is struggling to gain forward economic momentum.

Eurostat, the statistics office for the European Union, reported regional annual inflation for February turned negative after recording 0.3 percent for January. Fifteen member states in February reported negative annual rates.

Delegates from the European Union and the Organization of Petroleum Exporting Countries met in Vienna to review economic conditions as they relate to oil markets. A joint statement "noted with concern" that declines in oil prices, off more than 20 percent from last year, was putting broader investments and regional economies at risk.

"An affordable and stable oil price, alongside a balanced and stable market, is a prerequisite for economic growth for both producers and consumers," the statement read.

Despite a 14 percent recovery in crude oil prices for the year, few in the industry are expecting a major spike. Ian Taylor, the head of oil trader Vitol, said Tuesday he was taking a cautious approach.

"We expect this coming year to be challenging for the oil sector," he said.

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