|Published:||Feb 07, 2011 9:59 PM EST|
|Updated:||Feb 07, 2011 6:59 PM EST|
Oil prices fell Monday as investors shifted their focus from unrest in Egypt to the U.S. economy.
West Texas Intermediate crude, or WTI, for March delivery fell $1.55 to settle at $87.48 a barrel on the New York Mercantile Exchange. In London, Brent crude lost 58 cents to settle at $99.25 per barrel on the ICE Futures exchange.
Violent anti-government demonstrations in Egypt settled down after government officials negotiated on Sunday with opposition leaders, although many protesters still called for President Hosni Mubarek to step down. The lull eased fears of potential interruptions to crude supplies from the region.
Egypt controls the Suez Canal and a nearby pipeline that together carry about 2 million barrels of day from the Middle East to customers in Europe and America. That compares to about 87 million barrels consumed worldwide every day.
"The market seems to be developing a thick skin about the events in the Middle East in particular," Tradition Energy analyst Gene McGillian said. "I don't think there's as much of a worry about supply disruption."
Traders began looking more closely at the U.S. economy again after a mixed jobs report on Friday followed an Energy Department report showing record-high inventories at Cushing, Okla., the delivery point for benchmark WTI.
In addition a stronger dollar deterred some buyers. Since oil is priced in dollars, a stronger dollar makes it more costly for buyers who use foreign currencies.
Several analysts expect oil prices to trade in a narrow range over the next few days, moving on the day's news.
"We feel that this week will be characterized by a drift down in crude prices on days where either no new tensions arise or where political progress is perceived," JPMorgan analyst Lawrence Eagles told clients in a research note.
At the pump, the national average for regular gasoline was $3.122 a gallon on Monday, according to AAA, Wright Express and the Oil Price Information Service. That's 3.4 cents more than it was a month ago and 46.5 cents more than a year ago.
In other Nymex trading in March contracts, heating oil rose 1.06 cents to settle at $2.7061 a gallon and gasoline futures gained 1.52 cents to settle at $2.4505 a gallon. Natural gas fell 20.6 cents to settle at $4.104 per 1,000 cubic feet.
--- Associated Press writers Pablo Gorondi in Hungary and Alex Kennedy in Singapore contributed to this report.
(Copyright 2011 by The Associated Press. All Rights Reserved.)