Oil prices dip as Ukraine concerns cool slightly

New York: Global oil prices dipped Tuesday, after a successful presidential election in Ukraine over the weekend helped to ease some concerns despite continued fighting in the pro-Russian east. The US benchmark, West Texas Intermediate for delivery in July, closed at $104.11 a barrel, a decline of 24 cents from Friday.  In London, Brent North Sea crude for July settled at $110.02 a barrel, down 30 cents from Monday.

Markets in both New York and London were closed Monday for a holiday, but Brent had a settlement price for its electronic trade. Traders appeared to look past some encouraging US economic data. Durable goods orders unexpectedly rose for a third month in April, home prices rose month-over-month in March and consumer confidence improved in May. "US macroeconomic data looks supportive as does the prospect of ongoing violence in Ukraine and Libya, but oil supplies remain comfortable overall," said Tim Evans of Citi Futures.

Robert Yawger of Mizuho Securities USA said it appeared that the market got "a little bit" ahead of itself in aggressive buying last week after a bullish Department of Energy number on US crude inventories. Traders ‘don't know whether this justifies $105’ a barrel, he said. Phil Flynn of Price Futures Group said the market was trying to assess the latest developments in the Ukraine crisis."We are really seeing a lack of commitment in the market right now. Part of it is that we really don't know what to make of" Ukraine, he said.

Ukraine said Tuesday it had recaptured the airport in the eastern city of Donetsk after a day of air strikes and  gun battles with pro-Moscow separatist militants that left dozens of people dead. The battle erupted Monday just hours after president-elect Petro Poroshenko vowed to take a tough stand against the ‘terrorists’. Investors fear a full-blown conflict in the ex-Soviet state, a conduit for a quarter of Europe's natural gas imports from Russia, will disrupt supplies and send energy prices soaring.

In Libya, autonomist rebels who have been blockading eastern oil terminals since last July said they did not recognize the government of the newly elected prime minister, Ahmed Miitig, as legitimate. The blockades have prevented crude exports and caused oil production to fall to 250,000 barrels per day from 1.5 billion bpd.