Oil prices dips below $50 on ample supply, strong dollar
By Robert Gibbons
NEW YORK (Reuters) - Oil futures fell on Monday and U.S. crude slipped below $50 a barrel intraday as ample supply, the prospect of more Iranian crude for export and a strengthening dollar combined to pressure prices.
U.S. refined-products futures also oscillated. An increasing supply of refined products, especially diesel fuel being offered by Saudi Arabia, helped push U.S. ultra-low diesel futures to multi-month lows intraday, adding to bearish concerns about prices in the oil futures complex.
Brent September crude fell 45 cents to settle at $56.65 a barrel, having traded between $56.33 and $57.44.
U.S. August crude, set to expire on Tuesday, fell 74 cents to settle at $50.15, having fallen to $49.85, its first time below $50 since April.
"The dollar moved up again and the market focus is back on supply and the prospect for more Iranian exports after last week's agreement with the West over Iran's nuclear program," said Gene McGillian, analyst at Tradition Energy in Stamford, Connecticut.
The seesawing dollar rose early to three-month highs on expectations of rising U.S. interest rates, sending gold prices to their lowest in five years and helping pressure copper prices to near two-week lows.
A stronger dollar makes crude more expensive for investors using other currencies and rising U.S. interest rates are expected to curb liquidity, possibly adding to price pressures on crude oil.
Limiting crude futures' losses were a drop in Saudi crude exports in May and last week's industry data showing a lower U.S. oil rig count. Continued...