Crude oil prices in the U.S. significantly declined as the dollar fluctuations settled down, giving investors an opportunity to lock in profits from crude's recent rally
Crude oil prices in the U.S. significantly declined as the dollar fluctuations settled down, giving investors an opportunity to lock in profits from crude's recent rally.
A day after an almost $3 per barrel spike in crude prices on the New York Mercantile Exchange, concerns about Iran's nuclear ambitions limited the price drop in the front-month light, sweet crude oil contract on the New York Mercantile Exchange.
On Tuesday, the contract for delivery in May declined 59 cents to settle at $108.50 a barrel on the New York Mercantile Exchange.
The dollar stabilized against the euro Tuesday, making oil less effective as a hedge against inflation.
However, the declines were limited by concerns about Iran's announcement that it has begun installing and testing equipment at a uranium enrichment plant. The U.N. Security Council has already passed sanctions against Iran for expanding its nuclear program, and the market is concerned that an escalation of tensions could affect oil exports from the Middle East.
Many analysts expect oil prices to rise higher in coming months, possibly above last month's records, as the Federal Reserve cuts interest rates later in the year. Lower rates tend to weaken the dollar. Minutes of the Fed's March meeting, released Tuesday afternoon, showed policymakers were far from unified in their decision to cut the key federal funds rate by three-quarters of a percentage point, but are worried about the severity of the economic slowdown.
