Oil prices fall below 74 dollars

8th September 2010, Comments 0 comments

Oil prices fell below 74 dollars on Wednesday dragged down by sliding equity markets and a firmer dollar, analysts said.

New York's main contract, light sweet crude for delivery in October, dropped 21 cents to 73.88 dollars a barrel.

Brent North Sea crude for October slid 57 cents to 77.17 dollars in midday London trade.

Crude fell after "heavy losses" in equity markets, said Sucden Financial analyst Myrto Sokou.

"The US dollar continued to enjoy a strong rally against the euro which suffers amid renewed concerns about European banks and weaker than expected German exports and industrial output data," she added.

A stronger dollar makes oil more expensive for buyers holding other currencies, impacting demand.

Oil prices had traded mixed on Tuesday following an explosion at a Mexican oil refinery.

One worker died and two others were badly burned in an explosion at the Cadereyta refinery near Mexico's northern city of Monterrey.

The refinery produced 27 million litres of fuel per day in 2008, state oil company Pemex said.

"Mexico has a limited refining capacity... If this refinery is shut down it could create demand," said analyst Antoine Halff from Newedge Group.


© 2010 AFP

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