Oil slipped below $97 a barrel today, after falling just shy of the $100 milestone yesterday, on hopes of greater OPEC supplies as the market continued to watch the tumbling US dollar.
US light crude for January delivery fell 48 cents to $96.81 a barrel this evening, off lows of $96.37. Oil had briefly surged to a lifetime peak of $99.29 a barrel yesterday, before settling 74 cents lower.
London Brent crude was 24 cents lower at $94.60 a barrel.
Oil traded steady for most of the day amid thin volumes because of the market holiday for Thanksgiving in the US, before being knocked down by a report that showed an imminent surge in OPEC oil exports.
Roy Mason of consultancy Oil Movements said OPEC oil exports, excluding Angola, will surge 720,000 barrels per day in the four weeks to December 8, the biggest rise this year, with most of the extra supply heading to Western refiners.
Oil has been rising inversely to the dollar over the past months amid a fever of speculative trading and tightening stocks ahead of the winter.
The dollar hit a record low against the euro, the Swiss franc and a basket of currencies today, as the market anticipated that the Federal Reserve would deliver an interest rate cut next month.
A mixed US inventory report cut short oil's rally towards $100 yesterday. Crude stocks rose 1.2 million barrels to 14.6 million barrels last week, overshadowing an overall drawdown in US crude stocks.