Oil prices slip as US slides into government shutdown

Oil prices eased in Asian trade Tuesday as the US government began shutting down for the first time in 17 years following a gridlock in Congress over a new budget.

New York’s main contract, West Texas Intermediate for delivery in November, fell 30 cents to $102.03 in afternoon trade, while Brent North Sea crude for November dipped 60 cents to $107.77.

With the midnight deadline passing in Washington without any agreement, the White House ordered federal agencies to initiate their shutdown procedures, which will see more than 800,000 non-essential federal workers placed on unpaid leave.

The government shutdown will “result in the decrease in demand for oil in the world’s top oil consumer, pressuring prices, as hundreds of thousands of government employees would be forced to stay home without any pay,” Teoh Say Hwa, head of investment at Phillip Futures in Singapore, said in a note.