US crude oil futures recovered from a weak start on Monday, as concerns over the Cyprus bailout plan and its impact on oil demand faded towards the end of the session.

As part of a controversial €10bn bailout plan to save the country from default and recapitalise its banking sector, the European Union and International Monetary Fund said it plans to put a one-time tax levy on bank accounts in Cyprus to pay for the country's bailout.

ECB member Jörg Asmussen played down concern about contagion and said Cyprus' situation was unique. However the news sparked fears of a renewed European debt crisis and sent stock markets across the globe sharply lower.

Parliament in Cyprus is set to review the proposal for a one-time tax levy on bank accounts ahead of a vote on Tuesday.

Crude for April delivery traded at a low of $91.76 a barrel on jitters about the potential impact on oil later. Crude later settled up 29 cents at $93.74 on the New York Mercantile Exchange. The April contract traded at a high of $93.93 a barrel during Monday's session.

Over on the ICE futures exchange Brent for May settled down 31 cents at $109.51 a barrel in London.

Among precious metals gold rallied to a two-week high as the Cyprus news and concern about the Eurozone fuelled safe haven flows.

Gold for April delivery traded at a high of $1,610.40 before settling up 0.8% at $1,604.60 on the Comex in New York.


CJ

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