Oil hovers above $72 in Europe as traders eye uneven US recovery amid light holiday trading

Oil hovers above $72 in light 4th of July trading

Oil prices hovered above $72 a barrel Monday as investors worried about a weak U.S. economic recovery amid light holiday trading volume.

By early afternoon in Europe, benchmark crude for August delivery was up 10 cents to $72.24 a barrel in electronic trading on the New York Mercantile Exchange. The contract lost 81 cents to settle at $72.14 on Friday.

U.S. markets are closed Monday for the Fourth of July holiday.

Oil prices fell the previous six trading sessions and dropped almost 10 percent last quarter amid ongoing fears about Europe’s financial crisis and slowing economic growth.

“Obviously, speculative investors are taking their profits because of worries regarding an economic slowdown in the USA and China,” said a report from Commerzbank in Frankfurt.

On Friday, the Labor Department said the U.S. private sector added a net 83,000 workers, which was more than May but fewer than March and April, stoking concerns that global economic growth and crude demand could be slowing.

“The balance of crude oil price risks appears skewed towards the downside” because of “negative demand shocks from a sluggish economic recovery,” ANZ bank said in a report.

ANZ said it expects crude to trade between $65 a barrel and $75 this month.

In other Nymex trading in August contracts, heating oil rose 1.17 cents to $1.9272 a gallon, gasoline added 0.78 cent to $1.9855 a gallon and natural gas gained 4.2 cents to $4.729 per 1,000 cubic feet.

In London, Brent crude was up 32 cents to $71.97 a barrel on the ICE Futures exchange.

Associated Press writer Alex Kennedy in Singapore contributed to this report.