ATHENS: Oil fell below $63 a barrel on Wednesday after Greece defaulted on its debt to the International Monetary Fund while U.S. and OPEC production hit new highs, prompting concern about risks to the economic outlook and ample supply.
As well as Greece becoming the first developed economy to default on an IMF loan, oil came under pressure from a surprise gain in U.S. crude stocks reported by the American Petroleum Institute (API) and the prospect of higher Iranian oil exports.
Brent crude was down 70 cents at $62.89 a barrel at 0847 GMT. U.S. crude fell 89 cents to $58.58. Both contracts made gains on Tuesday. World powers and Iran are holding talks in Vienna on their nuclear dispute. A deadline for an agreement, which could pave the way for higher Iranian oil exports, has been extended until July 7.
“Greece is an additional risk factor, but I am more focussed on Vienna than on Athens right now,” said Olivier Jakob, oil analyst at Petromatrix in Zug, Switzerland.
