By Virginia Harrison, MarketWatch
LONDON (MarketWatch) — Crude-oil futures dropped on Tuesday, as the U.S. dollar rose against other currencies and global equity markets were mostly lower.
Crude for June delivery CLM11 -1.51% declined $1.16 to $112.36 a barrel in electronic trading on Globex.
Ben Potter, market strategist at IG Markets, said “oil has had a very good run” and the slight rally in the U.S. dollar contributed to a dip in crude prices.
There had been some market speculation that the death of Osama bin Laden would prompt a selloff in crude on a reduced risk-premium attached to prices, but oil settled just 0.4% lower in North American trading following the news Monday.
Analysts at MF Global wrote in a research note that bin Laden’s death was unlikely to result in sustained weakness in energy prices, since it doesn’t alter the key drivers that have pushed energy prices higher for the past several months. Those drivers include continued tensions in the Middle East, the ongoing stalemate in Libya and the weak U.S. dollar.
The dollar index DXY +0.19% , which measures the greenback against a basket of six major currencies, rose 0.4% to 73.311. Read more about currencies.
“The greenback will likely weaken over the course of the week, returning a measure of stability to the energy markets,” analysts at MF Global said.
Meanwhile, U.S. stock futures pointed to a lower opening on Wall Street, and European stock markets fell in afternoon trading.
