US crude drops $4 to near $126/bbl on dollar rally

22 July 2008 15:52  [Source: ICIS news]

LONDON (ICIS news)--NYMEX light sweet crude futures fell by more than $4/bbl on Tuesday to take the front-month August contract close to $126/bbl after a rally in the dollar following comments by US officials.

By 14:00 GMT, August NYMEX crude had hit a low of $126.26/bbl, a loss of $4.78/bbl from the previous close of $131.04/bbl, before recovering to around $127.05/bbl.

At the same time, September Brent crude on ICE Futures was trading around $128.95/bbl, having hit a low of $128.10/bbl, a loss of $4.51/bbl from the previous close.

The dollar rallied after US Treasury Secretary Henry Paulson reiterated the importance of a strong dollar.

Other US officials were reported to be commenting on the importance for the Federal Reserve to fight off inflation, reviving speculations of an interest rate hike.

However, tropical storm Dolly was still seen moving on south Texas, threatening major oil installations in the Gulf of Mexico and onshore petrochemical plants.

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By: Giovanni Coiro
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