Crude oil fell the most in a week as the euro tumbled against the dollar on speculation that Europe’s debt crisis may worsen. Oil dropped as much as 2.6 percent after German factory orders unexpectedly declined in July, causing the euro to weaken the most since Aug. 11. Equities declined, ending the Standard & Poor’s 500 Index’s longest winning streak since July, on concern the European situation will delay the global economic recovery.
“The euro’s broken down and the dollar’s gotten stronger,” said Tom Bentz, a broker with BNP Paribas Commodity Futures Inc. in New York. “That’s helping to put some pressure on oil.” Crude for October delivery lost 60 cents, or 0.8 percent, to $74 a barrel at the 2:30 p.m. close of floor trading on the New York Mercantile Exchange. Earlier, it touched $72.63 a barrel, the biggest single day decrease since Aug. 31. Prices have dropped 6.8 percent this year.
U.S. oil markets were closed yesterday for the Labor Day holiday. Yesterday’s electronic transactions will be booked with today’s trades for settlement purposes. The euro fell 1.3 percent against the dollar to $1.2707 from $1.2876 yesterday, curbing the appeal of commodities as an alternative investment. The euro has declined 1.5 percent since Sept. 3. The S&P 500 lost 0.8 percent to 1,096.24, snapping a four day rally. The Dow Jones Industrial Average fell 72.73 points, or 0.7 percent, to 10,375.20.
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