Oil prices drop as dollar strengthens

AFP PHOTO

NEW YORK – Oil prices continued their fall on Wednesday amid tensions over the eurozone’s political and economic problems that the stronger dollar.

“There remains considerable uncertainty about the eurozone’s debt problems and politics,” said Victor Shum, an analyst at Purvin and Gertz international energy consultants.

New York’s main contract, West Texas Intermediate (WTI) crude for delivery in June, dropped 20 cents to $96.81 a barrel, two days after hitting a near-five month low at $95.34.

Brent North Sea crude for June shed 47 cents to $113.20 a barrel in London.

Investor concerns about the repercussions of weekend elections in Greece were heightened after the head of the country’s left-wing Syriza party said his cabinet would reject all austerity measures imposed under an EU-IMF loan deal, if he forms a new government.

That is driving worries that Greece will be forced from the eurozone altogether – and that sent the euro tumbling Wednesday against the dollar, further softening demand for crude.

Crude was also under pressure from indications that Saudi Arabia, the world’s top oil producer, could increase its output.