Oil hovers below $95 amid stronger US dollar

[July 05, 2011]  SINGAPORE (AP) -- Oil prices hovered below $95 a barrel Tuesday in Asia as a stronger U.S. dollar made crude more expensive for investors with other currencies.

Benchmark oil for August delivery was down 34 cents to $94.60 a barrel at late afternoon Singapore time in electronic trading on the New York Mercantile Exchange. Crude last settled down 48 cents at $94.94 on Friday. Financial markets in the U.S. were closed Monday for the Independence Day holiday.

In London, Brent crude for August delivery was down 41 cents to $111 a barrel on the ICE Futures exchange.

The euro fell to $1.4477 Tuesday from $1.4541 late Monday while the dollar rose to 81.10 yen from 80.75.

Crude fell to near $90 early last week after the International Energy Agency announced June 24 the gradual release of 60 million barrels of oil from strategic reserves.

But oil prices have rebounded to where they were before the IEA announcement as the dollar weakened against the euro after the Greek parliament approved austerity measures, averting a debt default.

"Despite having one full week to digest the IEA's release of oil stocks, markets still seem confused," energy consultant The Schork Group said in a report. "In order to see any significant weakness below there (about $88), we will likely need to see a rally in the dollar."

In other Nymex trading in August contracts, heating oil fell 2.6 cents to $2.90 a gallon while gasoline fell 2.2 cents at $2.95 a gallon. Natural gas futures rose 0.8 cent at $4.32 per 1,000 cubic feet.

[Associated Press; By ALEX KENNEDY]

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