Oil little changed as U.S. lawmakers address tentative debt deal
BNN Bloomberg
Oil held steady as traders waited to see if U.S. lawmakers would approve a tentative deal to avert a catastrophic default.
Oil held steady as traders waited to see if U.S. lawmakers would approve a tentative deal to avert a catastrophic default.
West Texas Intermediate futures remained above US$72 a barrel after gaining 1.2 per cent on Friday. President Joe Biden and House Speaker Kevin McCarthy voiced confidence that their agreement will pass Congress and be signed into law, avoiding a default that would threaten a financial collapse. Treasury Secretary Janet Yellen has said the debt limit must be extended by June 5 to avoid default, giving lawmakers until next week to act on the deal. Liquidity is thin so far in trading on Monday, with the U.S. and U.K. observing national holidays.
The agreement “reduces the risk of a significant crash,” but “the outcome was pretty much priced in,” Bart Melek, global head of commodity strategy at TD Securities, said by phone. The agreement calls for reduced spending, making it “flat to modestly negative for demand.”
