US crude was showing some strong technical sell signals, as its Relative Strength Index (RSI) dipped to 62.9, indicating a pause in buying interest, after hitting 72.8 on Wednesday, above the 70 level that connotes an overbought situation.

In London, Brent crude’s RSI also dipped to 43.5, from 53.2 on Wednesday.

The selling came as traders also kept an eye on the euro zone, where the debt crisis threatened to engulf France and Spain, while Italy’s new leader outlined tough reforms to fight an economic emergency.

“We’re almost into a seventh week of gains in US crude and that has prompted some investors to take some profits,” said Gene McGillian, analyst at Tradition Energy in Stamford Connecticut.

“The selling today doesn’t indicate any sharp reversal from the recent uptrend,” he added citing worries about the euro zone and the US economy.

Brent crude extended losses to a second day, while US crude erased Wednesday’s more than 3 percent gains to tumble to a session low below $100. Brent and US crude moved in opposite directions on Wednesday on spread trading after news of a critical reversal of a pipeline flow to ease a glut in US Midwest supplies,

In London, ICE Brent crude for January delivery was down $4.04 at $107.84 a barrel by 1:10 p.m. EST (1810 GMT), having slid to a session low of $107.76, the lowest since Nov. 1. In early trading, January Brent broke below its 100-day moving average of $111.38.

US crude for December delivery, which expires on Friday, fell $3.76 to $98.83, after extending its session low to $98.65.

Brent’s premium against US crude, also known as West Texas Intermediate, narrowed further, hitting $7.88, the smallest since March 9..

The premium has declined sharply from the record $28.10 struck on Oct. 14, in part due to the speedy return of some Libyan crude oil to the European markets, following months of conflict, the growing euro zone debt troubles.

The Spanish government was forced to pay the highest borrowing costs since 1997 to sell 10-year bonds, and Paris had to pay markedly more to shift nearly 7 billion euros of government paper.

“People are spooked by the Spanish bond yield and the crisis seems to be escalating, pushing most markets lower,” said Simon Wardell, an oil analyst at Global Insight.

Italy’s new prime minister Mario Monti contributed to the bleak outlook on Thursday stating Italy faced a serious crisis and he could not imagine the European Union surviving if the euro zone collapsed.

Monti’s comments helped send oil prices to fresh intraday lows. A confidence vote on his freshly formed government is planned for 1930 GMT.

New US claims for jobless benefits unexpectedly fell last week to hit a a seven-month low, bolstering recent data that shows the labor market regaining momentum but not enough to cut into a 9 percent unemployment rate and boost economic growth, analysts said.

Another set of data showed the pace of factory activity in the US Mid-Atlantic region slowed more than expected in November after a sharp gain the month before, reflecting the spotty nature of the economic recovery.