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TREASURY

Congress to get debt-limit extension

Treasury Secretary Timothy F. Geithner is giving Congress a little more breathing room to negotiate a deal that would raise the nation’s borrowing limit.

In a new letter to congressional leaders, Mr. Geithner said Monday that he can delay an unprecedented default on the debt until Aug. 2, using a series of bookkeeping maneuvers to keep the government running. That’s a significant extension from the July 8 deadline Mr. Geithner previously cited.

The U.S. government will reach its $14.3 trillion borrowing limit on May 16. After that time Mr. Geithner can take such steps as removing investments from government employee and retiree pension funds to keep from going over the limit.

Republicans have said they will not vote to raise the debt limit until an agreement is reached with the White House on further spending cuts.

The debt subject to limit stood at $14.24 trillion as of last Friday, $58.1 billion below the current limit. With Congress back from a two-week recession, negotiations are expected to begin in earnest this week on the debt limit.

Mr. Geithner said he will begin making moves on Friday to delay a default.

OIL

Prices settle lower due to bin Laden, dollar

NEW YORK | Oil settled slightly lower Monday after volatile trading driven by uncertainty about extremist retaliation for the death of Osama bin Laden and the strength of the dollar.

Benchmark crude for June delivery fell 41 cents to settle at $113.52 a barrel on the New York Mercantile Exchange. In London, Brent crude lost 77 cents to settle at $125.12 a barrel on the ICE Futures exchange.

Bin Laden was killed Sunday by U.S. forces in Pakistan. Oil fell below $111 a barrel early Monday morning shortly after President Obama announced bin Laden’s death. By midmorning it was on the rise again, reaching $114.83 before it reversed course. Analysts say traders are concerned that bin Laden’s death may lead to retaliation from his followers that could affect oil supplies.

Oil also followed the dollar’s ups and downs. Oil rose as the dollar retreated from an early rally on news of bin Laden’s death. Later, as the dollar came back from its low, crude fell. Oil is priced in dollars. A weaker dollar makes crude more attractive to buyers with foreign currency, and the price tends to rise. The opposite often happens when the dollar strengthens.

AUTO

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