Oil fell from a ten-month high after concerns that banks may declare more defaults on loans pushed US equities lower and strengthened the dollar, decreasing the appeal of commodities to investors, Bloomberg reported.
Crude oil for October 2009 delivery declined as much as $0.62, or 0.8%, to $73.75 a barrel on the New York Mercantile Exchange. It was traded at $73.82 at 10.45am in Singapore. Yesterday the contract rose $0.48 to settle at $74.37.
Many US stocks declined, led by financial companies, after SunTrust Banks said that lenders faced more credit losses and commercial real estate may falter through 2010.
Oil also dropped as investors sought ‘safe-haven’ currencies such as the dollar in the face of weaker equities, according to Bloomberg.
Most Asian stocks dropped, with the MSCI Asia Pacific dropping 0.4% to 112.93 as of 11.52am in Tokyo. The index rallied 2.5% on 24 August – the steepest advance since 19 May.
Brent crude oil for October 2009 settlement dropped as much as $0.51, or 0.7%, to $73.75 a barrel on the London-based ICE Futures Europe exchange. It was traded at $73.75 a barrel at 10.42am in Singapore. On 24 August the contract gained $0.07 to close at $74.26 a barrel.