By Virginia Harrison, MarketWatch
SYDNEY (MarketWatch) — Oil futures retreated in electronic trading Tuesday, falling below $98 a barrel, as the dollar strengthened.
Light, sweet crude for January delivery CL2F +0.67% declined 68 cents, or 0.7%, to $97.53 a barrel on the New York Mercantile Exchange during Asian trading hours.
Oil had gained 1.5% in Monday’s North American session, encouraged by signs of progress in the resolution of Europe’s debt woes, as well as strong U.S. retail spending over the Thanksgiving holiday. Read more on Monday's oil session.
Relative optimism about Europe spurred stocks across Asia on Tuesday, but oil failed to catch the wave of improved risk sentiment amid a stronger dollar.
The U.S. dollar index DXY -0.11% rose to 79.245, from 79.236 in North American trading late Monday.
A stronger greenback can discourage investment in dollar-priced commodities such as crude oil, as it makes them more expensive to holders of other currencies.
Virginia Harrison is a MarketWatch reporter based in Sydney.
