By Christian Berthelsen
NEW YORK--U.S. oil futures broke below the $100-a-barrel
threshold for the first time in more than two months, as the return
of Libyan barrels to the market and potentially bullish Fed
comments for the U.S. dollar weighed on prices.
Light sweet crude futures for August delivery touched a low of
$99.72 in early trading on the New York Mercantile Exchange
Tuesday, falling below the $100 marker for the first time since May
12. The market has been in a prolonged selloff as fear premiums
about geopolitical threats to supply stability from Ukraine and
Iraq have eased, and Libya has finally resumed oil production after
monthslong delays due to rebel strikes.
The global Brent contract was down $1.42 or 1.4% to $105.56 a
barrel on the ICE Futures Europe exchange.
Libyan oil officials said the country's Sharara field had
increased production to 554,000 barrels a day. Still, instability
continued to plague the country, with a missile attack on the
airport in the capital of Tripoli.
Meanwhile, some traders were preparing for testimony by Fed
Chairwoman Janet Yellen that could strengthen the dollar, which can
have an inverse impact on oil prices. Investors are watching Ms.
Yellen's testimony for clues about when the Fed may begin to raise
interest rates amid improving economic signals. The dollar recently
ticked up against a basket of global currencies, rising 0.02% to
80.21 on the ICE U.S. Dollar index.
Front-month August futures for reformulated gasoline blendstock,
or RBOB, were down 2.5 cents to $2.9001 a gallon on the Nymex.
August diesel was down 2.85 cents to $2.8444 a gallon.
Write to Christian Berthelsen at
christian.berthelsen@wsj.com