SINGAPORE (AP) -- Oil prices fell below $106 a barrel Tuesday in Asia on a strengthening dollar and expectations a weakening Hurricane Ike may not disrupt Gulf of Mexico drilling and refining operations.Light, sweet crude for October delivery fell $1.15 to $105.19 a barrel in electronic trading on the New York Mercantile Exchange midday in Singapore. The contract inched up 11 cents overnight to settle at $106.34.
The dollar got a boost -- especially against the euro and British pound -- from the U.S. Treasury's decision Sunday to take control of mortgage giants Fannie Mae and Freddie Mac, which own or guarantee about half of U.S. mortgage debt, removing uncertainty over their future that had been weighing on global markets.
"It's going to help improve the U.S. credit markets and help the dollar continue to strengthen, at least in the short term," said Jonathan Kornafel, Asia director for brokerage Hudson Capital Energy in Singapore.
A rising greenback spurs investors to sell commodities like oil and precious metals, which are traditionally seen as hedges against inflation.
The euro fell Tuesday to $1.4071 from $1.4123 late Monday in New York. At one point, it dropped as low as $1.4045, a level not seen since last October. The British pound also fell to $1.7557 from $1.7579. The dollar dipped to 107.48 yen from 107.99 yen late Monday.
Oil prices also fell on expectations Hurricane Ike won't cause significant damage to oil operations in the Gulf region after the storm weakened Monday from a Category 3 storm to a Category 1, with winds around 80 mph.
"If the market thought there was a good chance of it causing damage, oil would be at $108 or $110," Kornafel said.
Ike roared ashore in eastern Cuba on Sunday and was expected to hit Havana on Tuesday.
The storm first slammed into the Turks and Caicos and the southernmost Bahamas islands as a Category 4 hurricane that peeled off roofs and knocked down buildings. At least 61 people were killed as it pelted Haiti.
Investors are also waiting to see what action OPEC will take at its meeting Tuesday in Vienna.
Kuwait's oil minister, Mohammed Abdullah Al-Aleem, said Tuesday there is no need for the Organization of the Petroleum Exporting Countries to cut production, despite falling crude prices. Some other OPEC officials, however, including those from Iran and Libya, said there is too much crude on the market.
Crude has plunged about $42, or 29 percent, since surging to a record $147.27 a barrel on July 11.
In other Nymex trading, heating oil futures fell 2.62 cents to $2.9869 a gallon, while gasoline prices dropped 3.03 cents to $2.72 a gallon. Natural gas for October delivery fell 16.3 cents to $7.364 per 1,000 cubic feet.
In London, October Brent crude fell 94 cents to $102.50 a barrel on the ICE Futures exchange
The dollar got a boost -- especially against the euro and British pound -- from the U.S. Treasury's decision Sunday to take control of mortgage giants Fannie Mae and Freddie Mac, which own or guarantee about half of U.S. mortgage debt, removing uncertainty over their future that had been weighing on global markets.
"It's going to help improve the U.S. credit markets and help the dollar continue to strengthen, at least in the short term," said Jonathan Kornafel, Asia director for brokerage Hudson Capital Energy in Singapore.
A rising greenback spurs investors to sell commodities like oil and precious metals, which are traditionally seen as hedges against inflation.
The euro fell Tuesday to $1.4071 from $1.4123 late Monday in New York. At one point, it dropped as low as $1.4045, a level not seen since last October. The British pound also fell to $1.7557 from $1.7579. The dollar dipped to 107.48 yen from 107.99 yen late Monday.
Oil prices also fell on expectations Hurricane Ike won't cause significant damage to oil operations in the Gulf region after the storm weakened Monday from a Category 3 storm to a Category 1, with winds around 80 mph.
"If the market thought there was a good chance of it causing damage, oil would be at $108 or $110," Kornafel said.
Ike roared ashore in eastern Cuba on Sunday and was expected to hit Havana on Tuesday.
The storm first slammed into the Turks and Caicos and the southernmost Bahamas islands as a Category 4 hurricane that peeled off roofs and knocked down buildings. At least 61 people were killed as it pelted Haiti.
Investors are also waiting to see what action OPEC will take at its meeting Tuesday in Vienna.
Kuwait's oil minister, Mohammed Abdullah Al-Aleem, said Tuesday there is no need for the Organization of the Petroleum Exporting Countries to cut production, despite falling crude prices. Some other OPEC officials, however, including those from Iran and Libya, said there is too much crude on the market.
Crude has plunged about $42, or 29 percent, since surging to a record $147.27 a barrel on July 11.
In other Nymex trading, heating oil futures fell 2.62 cents to $2.9869 a gallon, while gasoline prices dropped 3.03 cents to $2.72 a gallon. Natural gas for October delivery fell 16.3 cents to $7.364 per 1,000 cubic feet.
In London, October Brent crude fell 94 cents to $102.50 a barrel on the ICE Futures exchange
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