US crude fell by $1.82 to stand at $86.42 a barrel today as the dollar rose and a weak global outlook dampened oil demand.

Spurred by Europe’s deepening sovereign debt crisis, investors shunned commodity risk, which led to a $1.74 fall in Brent crude to $111.65 a barrel.

Oil prices were also affected by falling oil demand from China, the world’s second-largest consumer of crude, reports Reuters.