Oil prices have fallen sharply responding to a strengthening US dollar and signs of weaker demand for crude.
US sweet, light crude fell $3.36, to $121.37 a barrel in New York, while London's Brent crude fell by a similar amount to trade at $122.48.
Prices are about $25 off their peak earlier in July, when prices reached records of more than $147 a barrel.
The dollar, which offers an alternative investment to oil and often dictates the way it moves, hit a one-month high.
In previous months, oil prices have rallied to record levels partly because some investors were looking to protect themselves from a weakening US currency.
As well as the stronger dollar on Tuesday, there were also signs that a slowing global economy was hitting demand for oil.
BP boss Tony Hayward said he saw lower demand for petrol in developed economies, as people drove less due to the higher fuel prices.
Back to $100?
On Monday, the Energy Information Administration said that US oil demand in May was 660,000 barrels per day less than previously thought.
"We're seeing both statistical and anecdotal evidence of very rapidly weakening demand picture," said Jim Ritterbusch, president of energy consultancy Ritterbusch and Associates.
"I think we could see $117 a barrel in a one-week time frame, and this market could eventually get to $100."
However fears of tight supplies could resurface after Shell said a pipeline and some crude production in Nigeria had been shut down as a result of sabotage by militants.
(BBC)
<< Back