Oil above $95 after stimulus comments

Oil prices hovered above $95 (Dh348) a barrel yesterday after Federal Reserve Chairman Ben Bernanke said another round of monetary stimulus was not imminent and Standard & Poor's warned it may cut the US debt rating. Benchmark oil for August delivery was down 3 cents to $95.66 a barrel early afternoon European time in electronic trading on the New York Mercantile Exchange. Crude fell $2.36 to settle at $95.69 on Thursday. In London, Brent crude fell 28 cents to $115.98 per barrel on the ICE Futures exchange. Bernanke said Thursday that there would have to be signs of deflation before the Fed would consider a third round of Treasury bond purchases, known as quantitative easing, or other stimulus measures. Article continues below Considering more stimulus Quantitative easing weakens the US dollar and boosts demand for oil, which is traded in dollars. On Wednesday, Bernanke's comments that the Fed would consider more stimulus if the economy worsens had sent oil prices higher. Meanwhile, credit rating agency Standard & Poor's said there is a 50 per cent chance it will downgrade the US government's credit rating within three months because of the congressional impasse over approving an increase in the debt ceiling. The warning followed a similar move by Moody's and weighed on market sentiment, both in commodities and equities.