NEW YORK—Oil prices tumbled from two-year highs Monday in New York as traders fretted about the impact of recent price rises on the weak US economic recovery.
New York’s main contract, light sweet crude for delivery in May, closed below the psychological $110 threshold a barrel.
The West Texas Intermediate future contract settled at $109.92, down $2.87 from Friday’s closing level. The benchmark WTI had climbed in early Asian trading as high as $113.46, a peak last seen in September 2008.
In London, Brent North Sea crude for delivery in May shed $2.67 to settle at $123.98 a barrel.
“If oil stays at these sustained prices, $110-113 and beyond, it has a really good chance to derail our economic comeback,” said Rich Ilczyszyn at Lind-Waldock.
The oil market was taking a breather after strong gains, Ilczyszyn said. Other commodities, such as gold, which had hit all-time highs, were also lower in profit taking.
The market fell back from those high points as the dollar regained strength against the euro, making dollar-priced crude less attractive to investors.
Despite the price pullback, investors remained jittery over potential supply disruptions if the unrest escalates in the Middle East and North Africa region, analysts said.