By Virginia Harrison, MarketWatch
SYDNEY (MarketWatch) – Crude oil dropped in electronic trading on Monday, following news that Osama bin Laden has been killed in a U.S. operation directed at the terrorist leader.
Light sweet crude for June delivery CLM11 -1.27% shed $1.37 or 1.2%, to $112.54 a barrel on the New York Mercantile Exchange during Asian trading hours. Oil closed out last week at its highest level since September 2008, to settle at $113.93 a barrel on Friday.
U.S. President Barack Obama said late Sunday that Osama bin Laden, leader of the terrorist network Al Qaeda, has been killed at a mansion outside the Pakistani capital Islamabad.
Bin Laden was killed after a firefight in which no Americans were harmed and U.S. forces took custody of bin Laden’s body, Obama said in the nationally televised address. Read more about President Obama’s statement.
Commodity prices dropped as the U.S. dollar advanced after the news. The dollar index DXY +0.23% -- which measures the greenback against a basket of six major currencies -- traded at 73.157, from 72.960 in late North American action on Friday. Read more about currency markets
City Index Chief Market Analyst Peter Esho said he expects crude oil will trend lower going forward.
“Oil has a self-correcting mechanism, when demand comes down the price tends to ease. We’re starting to see that mechanism work out. I wouldn’t be surprised if [Nymex] slips below $100 a barrel,” he said.
