Investing.com - West Texas Intermediate and Brent oil prices tumbled sharply on Tuesday, as a broadly stronger U.S. dollar and ongoing concerns over a global supply glut weighed.
On the New York Mercantile Exchange, crude oil for delivery in January fell by as much as 3.27% to touch a daily low of $66.74 a barrel, before trading at $67.50 during U.S. morning hours, down $1.50, or 2.17%.
A day earlier, Nymex oil futures fell by as much as 3.6% to $63.72 a barrel, a level not seen since July 2009, before rallying to settle at $69.00, up $2.85, or 4.31%, as market players closed out bets on lower prices.
Elsewhere, on the ICE Futures Exchange in London, Brent oil for January lost $1.29, or 1.79%, to trade at $71.25 a barrel.
London-traded Brent prices hit $67.57 a barrel on Monday, the weakest level since October 2009, before turning higher to close at $72.54, up $2.39, or 3.41%.
The US dollar index, which tracks the greenback against a basket of six major rivals, was up 0.57% on the day to trade at a five-year high of 88.53.
Dollar-denominated oil futures contracts tend to fall when the dollar rises, as this makes oil more expensive for buyers in other currencies.
London-traded Brent prices have fallen nearly 39% since June, when it climbed near $116, while WTI futures are down almost 38% from a recent peak of $107.50 in June.
The Organization of Petroleum Exporting Countries said on November 27 that it would keep its official production target unchanged at 30 million barrels a day, disappointing hopes the oil cartel would lower output to support the market.
The 12-member group is responsible for approximately 40% of global supply. Their next meeting is scheduled for June 5, 2015.
Concerns over weakening global demand combined with indications that OPEC producers will not cut output have weighed on prices in recent months.
Meanwhile, oil traders awaited the release of fresh weekly information on U.S. stockpiles of crude and refined products to gauge the strength of demand in the world’s largest oil consumer.
The American Petroleum Institute will release its inventories report later in the day, while Wednesday’s government report could show crude stockpiles rose by 0.9 million barrels in the week ended November 28.