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Crude oil fell for the first time in three days as the dollar strengthened against the euro, limiting the appeal of commodities as an alternative investment.
Oil dropped as much as 2 per cent as the dollar rose to a three-month high against the European currency and US equities declined. Futures are 12 per cent below the year’s high of $US82 a barrel reached October 21. US oil supplies are 6.4 per cent above the five-year average, the Energy Department said yesterday.
"The dollar’s stronger, and that’s for the most part the big thing here," said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston.
Crude oil for January delivery fell 70 US cents, or 1 per cent, to $US71.96 a barrel at on the New York Mercantile Exchange. Earlier, futures touched $US71.21 a barrel. Oil has risen 61 per cent this year.
The dollar strengthened to $US1.4329 per euro in New York from $US1.4531 yesterday. Earlier it touched $US1.4305, the highest since September 7.
The US currency gained a day after the Federal Reserve said economic conditions have improved. The index of leading US indicators increased in November for an eighth consecutive month, signaling that the economic recovery will probably extend into the first half of 2010.
The euro was pressured after Standard & Poor’s cut Greece’s debt rating and said it may go lower.
Oil price falls as $US jumps
It is great news for Americans.
Oil dropped as much as 2 per cent as the dollar rose to a three-month high against the European currency and US equities declined. Futures are 12 per cent below the year’s high of $US82 a barrel reached October 21. US oil supplies are 6.4 per cent above the five-year average, the Energy Department said yesterday.
"The dollar’s stronger, and that’s for the most part the big thing here," said Carl Larry, president of Oil Outlooks & Opinions LLC in Houston.
Crude oil for January delivery fell 70 US cents, or 1 per cent, to $US71.96 a barrel at on the New York Mercantile Exchange. Earlier, futures touched $US71.21 a barrel. Oil has risen 61 per cent this year.
The dollar strengthened to $US1.4329 per euro in New York from $US1.4531 yesterday. Earlier it touched $US1.4305, the highest since September 7.
The US currency gained a day after the Federal Reserve said economic conditions have improved. The index of leading US indicators increased in November for an eighth consecutive month, signaling that the economic recovery will probably extend into the first half of 2010.
The euro was pressured after Standard & Poor’s cut Greece’s debt rating and said it may go lower.
Oil price falls as $US jumps
It is great news for Americans.