New York: US crude futures fell for the third straight day on Friday as Standard & Poor's downgraded credit ratings of several Eurozone countries, stoking fears of deeper economic troubles for the region.

Losses were curbed by short-covering ahead of the long holiday weekend with traders worried over potential supply disruptions in Nigeria and Iran.

Late in the afternoon, S&P issued its announcement of the downgrades. In post-settlement trading, Nymex crude futures had slim gains, but at the end of electronic trading, crude futures were back to negative territory.

Tensions between Iran and the West over Tehran's nuclear ambitions continue. But news on Thursday that plans for an embargo of Iranian oil imports would be delayed for months had sharply slashed the geopolitical risk premium arising from Iran's threat to close the key Strait of Hormuz oil shipping lane.

Nymex floor trading will be closed tomorrow, the Martin Luther King Jr Day holiday.

On the New York Mercantile Exchange, February crude settled at $98.70 (Dh362.23) a barrel, dropping 40 cents, or 0.40 per cent. In post-settlement trading, it last traded at $99.03, down 7 cents.

For the week, front-month crude fell $2.86, or 2.82 per cent, after closing in the previous week up $2.73, or 2.76 per cent.

Settle down

In London, February Brent crude, which expires tomorrow, settled down 82 cents, or 0.74 per cent, at $110.44, narrowing its premium against US crude to $11.74 at the close, from $12.16 on Thursday.

Nymex February RBOB settled up 0.29 cent, or 0.11 per cent, at $2.7342 a gallon. For the week, the contract fell 1.74 cents, or 0.63 per cent, after gaining 6.53 cents, or 2.43 per cent the week before.

Nymex February heating oil closed down 2.69 cents, or 0.88 per cent, at $3.0272. For the week, it fell 4.3 cents, or 1.4 per cent, after gaining 13.52 cents, or 4.61 per cent the previous week. Hedge funds and other large investors increased their net long positions on Nymex crude by 2,365 contracts to 201,672 in the week to Tuesday, the US Commodity Futures Trading Commission said.

S&P stripped France of its top AAA rating and carried out a mass downgrade of half of the nations in the Eurozone. Germany, the bloc's largest economy, was spared.

British Prime Minister David Cameron said the world would "come together" to prevent Iran closing the Strait of Hormuz oil shipping route.