In the week to Feb. 3, US West Texas Intermediate (WTI) futures prices steadily declined while UK Brent prices trekked higher, widening the arbitrage to recent highs. Early in the period, US and UK crude posted intraday strength on hope that a debt-restructuring deal for Greece would avoid a default and help contain the eurozone debt crisis. However, any price support US WTI gained was quickly erased by bearish economic data in the US that showed lower home prices, a weaker-than-anticipated labor market in the Midwest, and waning consumer confidence. Brent crude prices, however, continued to find support from tensions between Iran and the West, including the EU's planned Iranian oil embargo. Also, colder temperatures in Europe that drove up demand for heating fuel helped lift crude prices. Brent closed the week at a near-three-month high.
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