Crude oil fell for a second day towards $81 a barrel, retreating from record highs hit last week as producers in the Gulf of Mexico returned workers to oil rigs evacuated last week.
The disruption to U.S. Gulf supply following last weeks storm threat, as well as falling U.S. crude oil inventories helped drive oil to a record of $83.90 a barrel last Thursday. Prices have fallen back since then and analysts predict a further correction may be on the cards.
Crude oil for November delivery fell as much as 56 cents, or 0.7 percent, to $81.06 a barrel in after-hours electronic trading on the New York Mercantile Exchange. It was at $81.15 at 2:05 p.m. in Singapore, according to data from Bloomberg.
The contract dropped 16 cents, or 0.2 percent, to $81.62 on Sept. 21, trimming its gain for the week to 4.5 percent. The October contract reached a record $83.90 on its last day of trading on Sept 20.
The U.S. National Hurricane Center yesterday canceled a reconnaissance flight over a weather system near the Yucatan Peninsula previously considered to pose a strengthening risk.
Upper-level winds over this system are currently very strong and development, if any, is expected to be slow to occur, the center said in an advisory on its Web site.
Oil and other commodities have been boosted by the sickly dollar, which hit a record low against the euro for a third straight session on Monday.
The U.S currency dropped to the lowest its been in 15 years as data to be released on Tuesday is forecasted to show the lowest home resales in five years. Traders are expecting at least one more interest rate cut by the end
Gold is at a 28 year high.
The Organization of the Petroleum Exporting Countries plans to raise output by 500,000 barrels per day (bpd) from November 1, a move analysts have said is too little to calm concern that peak demand during winter will drain stocks.