Brent crude oil traded at 110.64 on Friday morning as US lawmakers scheduled an emergency meeting to try to resolve its deficit problems. The commodity has shouldered heavy doubts that the world's number one oil consumer, the US, would reach an agreement before the January 1st fiscal cliff deadline.
After weeks of discussion, Democrats and Republicans have failed to reach an agreement about how to avert the near $600 billion bundle of tax increases and spending cuts that make up the fiscal cliff. According to Reuters, President Obama and Vice President Joe Biden are set to meet with congressional leaders from both parties on Friday at 3:00 GMT. The meeting is a last ditch effort to come up with a proposal that will satisfy both sides.
Investors remain divided in their predictions for the outcome of the meeting, some believe the meeting will result in a delayed deadline, which would give lawmakers more time to come up with a solution. On the other hand, there are many who are optimistic about the meeting's result, and expect a new proposal. Should a new proposal be drawn up, the House of Representatives has scheduled a session for Sunday to review it.
While the fiscal cliff has taken the center stage and largely directed crude prices recently, new promising economic data from the US gave Brent a bit of a lift on Friday as well. Unemployment benefit claims were down and housing sales reached a new high, which indicated that the economy was picking up.
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