Crude Oil Plunges To Settle Below $53 A Barrel

(RTTNews) - U.S. crude oil plummeted to end at a more than two-month low for a third straight session on Monday, on demand growth concerns after Greek voters rejected a bailout offer proposed by its international creditors with an increasing likelihood of an exit from the eurozone.

Oil prices were also impacted on rising concerns of a global oversupply situation with a potential nuclear deal between Iran and the West in the offing. The two sides are expected to come to an agreement over Iran's nuclear program, the deadline for which is Tuesday. The Iranian foreign minister has expressed confidence of the deal coming through.

Markets were under pressure after Greece voted to reject austerity measures proposed by its international creditors. The 'no' vote in the referendum has added to recent concerns about Greece defaulting and exiting from the eurozone.

European Council President Donald Tusk has convened a special Euro Summit on July 7 to discuss the situation after Greek referendum. Ahead of the Euro summit, German Chancellor Angela Merkel and French President Francois Hollande are set to hold talks in Paris Monday.

Meanwhile, Germany says it sees no reason to re-start talks with Greece.

The European Central Bank will discuss later today whether to continue the emergency liquidity assistance to Greece banks. The assistance from the ECB is vital for Greek banks to stay liquid.

Light Sweet Crude Oil futures for August delivery, the most actively traded contract, plunged $4.40 or 7.7 percent, to settle at $52.53 a barrel on the New York Mercantile Exchange Monday.

Crude prices for August delivery scaled a high of $55.34 a barrel intraday and a low of $52.41.

On Thursday, crude oil prices dipped $0.03, to settle at $56.93 a barrel, after data from Baker Hughes showed an increase in weekly oil rig count following the jump in U.S. crude stockpiles last week.

The dollar index, which tracks the U.S. unit against six major currencies, traded at 96.19 on Monday, down from its previous close of 96.39 on Thursday in late North American trade. The dollar scaled a high of 96.63 intraday and a low of 96.02.

The euro trended lower against the dollar at $1.1060 on Monday, as compared to its previous close of $1.1115 in North American trade late Thursday. The euro scaled a high of $1.1115 intraday and a low of $1.0995.

On the economic front, activity in the U.S. service sector expanded at a modestly faster rate in June, with a report from the Institute for Supply Management on Monday showing its non-manufacturing index inched up to 56.0 in June from 55.7 in May. A reading above 50 indicates growth in the service sector. Economists expected the index to rise to 56.4.

Eurozone investor confidence improved from a four-month low despite the Greece crisis, survey data from the think tank Sentix showed Monday. The investor confidence index rose unexpectedly to 18.5 in July from 17.1 in June, while it was forecast to fall to 16.

Germany's factory orders decreased for the first time in three months in May reflecting the weakness in domestic market. Factory orders fell 0.2 percent month-on-month in May, in contrast to a 2.2 percent increase in April, which was revised up from a 1.4 percent growth, Destatis reported Monday. This was the first decline in three months, but was slower than the expected decrease of 0.4 percent.

Germany's construction sector activity grew at the weakest pace in five months in June as new orders declined, survey data from Markit Economics showed Monday. The seasonally adjusted Purchasing Managers' Index, or PMI, for the construction sector, declined to 50.7 in June from 50.8 in the previous month.