WTI oil trading near $101 as strong US dollar and euro crisis weighs on prices

WTI oil futures are trading near $101 a barrel on Monday afternoon as a stronger US dollar foreign exchange rate, together with the ongoing concerns over the European debt crisis weigh on crude oil prices.

Latest WTI Oil Price

US Light crude oil futures for February 2012 delivery was trading at $101.30 a barrel, 19.05 GMT today on the NYMEX.

Stronger US Dollar

The US dollar is set for a comeback in 2012 as the US Dollar Index reaches its highest point in over a year, weighing down oil prices and other commodities.

Several factors have conspired to help the ICE US Dollar Index hit 81.077 on Monday, causing Dennis Gartman to write “the US dollar again reigns quietly supreme.” After a weak 2011, the greenback is now above values registered 12 months ago. At $1.2759, the Euro-Dollar exchange rate is trading at levels not seen since September 2010.

European Debt Crisis

In Berlin today, German Chancellor Angela Merkel and French President Nicolas Sarkozy met to discuss their latest initiative to contain Europe’s sovereign debt crisis, which relies on containing budget deficits in member countries.

“The bigger picture is that a huge amount of uncertainty reigns with the euro debt crisis. The oil market has a lot of trepidation ahead of a lot of uncertainties this week.” said Matt Smith, analyst at reasearch firm Summit Energy.

More here: 
WTI oil trading near $101 as strong US dollar and euro crisis weighs on prices