By Michael Kitchen, MarketWatch
LOS ANGELES (MarketWatch) — Oil’s recent gains unraveled further during Asian trading hours Monday, as concerns about the future of Europe sent crude-oil futures down sharply, along with stocks.
New York Mercantile Exchange benchmark crude-oil for September delivery CLU2 -1.74% fell 1.4%, or $1.30, to $90.53 a barrel in electronic trade.
The retreat tracked gains for the U.S. dollar, with the ICE dollar index DXY +0.28% rising to 83.704 from 83.457 late Friday. Gains in the greenback tend to depress prices for dollar-denominated commodities, such as oil, as it makes them more expensive to holders of other currencies.
Asian stocks, meanwhile, sold off sharply as concerns grew over the future of aid for Greece and a possible widening of assistance for Spain.
Hong Kong’s Hang Seng Index HK:HSI -2.45% had tumbled 2.6% by midday, while Japan’s Nikkei Stock Average JP:100000018 -1.54% traded down 1.3% in the early afternoon. Read more in Asia Markets.
On Friday, the front-month Nymex August crude future settled with a loss of 1.3% at $91.44 a barrel, snapping a seven-day winning streak. Read more on Friday’s crude-oil trade.
Writing after the Friday close, GFT Markets senior market strategist David Morrison said that if Nymex crude were able to hold above $90 a barrel, “then oil could build a base from which to rally further. But if the sell-off gathers strength, then speculative buyers will look to close out and go short, driving prices lower.”
Most other products tracked crude lower, with August gasoline RBQ2 -0.86% down 0.7% at $2.92 a gallon, and August heating-oil HOQ2 -1.07% off 0.9% at $2.90 a gallon.
Natural gas for August NGQ12 +0.03% , however, rose 0.2% to $3.09 per million British thermal units.
Michael Kitchen is Asia editor for MarketWatch and is based in Los Angeles.
