Brent crude oil traded at $109.65 on Monday at 6:52 GMT after Cypriot banks reopened without issue following the nation's controversial bailout plan.
After averaging near $112 per barrel in 2012, its highest annual price to date, the commodity has had a slow start to 2013. After EU officials agreed to raise funds in Cyprus by taking nearly 60 percent from account holders with more than 100,000 euros in Cypriot banks, markets took a nosedive as many worried about the consequences both inside and outside the tiny island nation.
Although the threat of this type of bailout funding becoming a precedent for other eurozone countries still remains in the forefront of investors' minds, Cypriot banks reopened last week without any major issues. The calm served as reassurance that the issues in Cyprus would not take down the entire eurozone.
With the European Central Bank meeting approaching, investors will be watching closely for clues about the region's finance ministers' plans for the eurozone economy. Despite growing financial and political problems, most are expecting the ministers to keep the region's 0.75 percent interest rate unchanged.
Brent futures began the year on shaky ground and extended 2012's 1 percent loss in the fourth quarter by finishing the first quarter of 2013 with a 0.9 percent loss. In stark contrast to Brent's figures, Reuters reported that US crude futures increased by 5.9 percent in the first quarter. The gap highlights Europe's bleak outlook and the US' improving economic growth.
Heading in to the second quarter, many are expecting the eurozone to continue its struggle, which will weigh on Brent prices. With the Italian government still in pieces following the nation's inconclusive elections and the future effects of Cyprus' bailout terms still uncertain, the eurozone has a long way to go before its much anticipated recovery.
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