Commodity Corner: Oil Falls as Dollar Strengthens
The price of light sweet crude oil declined $1.31 Monday to settle at $95.93 a barrel. The Brent benchmark also ended the day lower at $116.05 a barrel, or down $1.21 from Friday's settlement.
A stronger dollar against the euro prompted Monday's selloff as investors focused on Europe's ongoing debt woes and concerns about slackening oil demand. A stronger greenback makes dollar-denominated crude oil a less attractive buy for investors using other currencies.
The euro lost value after the European Banking Authority on Friday issued the results of its latest stress test of banks in the Eurozone. Nearly 27 percent of the 90 banks examined fared poorly in the exercise, which predicted how well they could withstand deteriorating economic conditions. Eight of the institutions examined failed the stress test outright while another 16 barely passed.
The WTI benchmark fluctuated from $94.69 to $97.69 during Monday's session while the Brent contract traded within a range from $114.76 to $116.95.
Despite a heat wave that has boosted natural gas futures recently, the front-month contract price remained unchanged at $4.55 per thousand cubic feet Monday. Natural gas peaked at $4.61 and bottomed out at $4.48.
The price of a gallon of gasoline ended the day at $3.10, a three-cent decline from Friday. The intraday range for gasoline spanned from $3.05 to $3.15.