Oil prices slipped below $80 a barrel Thursday as a stronger dollar made crude more expensive for international investors and the market received mixed signals on the strength of the U.S. economy.
By early afternoon in Europe, benchmark crude for April delivery was down 50 cents to $79.50 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.14 to settle at $80 on Wednesday.
Investors had cheered comments by Federal Reserve Chairman Ben Bernanke, who told Congress on Wednesday he expects interest rates will remain low for an extended period to help boost an economy emerging from last year's recession. The Dow Jones industrial average rose 0.9 percent.
"The stock market appeared to rejuvenate the bullish oil argument that this economic optimism will eventually translate into a significant upswing in OECD demand," Galena, Illinois-based Ritterbusch and Associates said in a report. "This month's bull run has not necessarily achieved completion."
By Thursday, however, stock markets in Asia and Europe were mostly lower, while the dollar strengthened on continued fears about the indebtedness of some European economies, like Greece and Spain.
Analysts were split over how much the dollar and stock markets were affecting oil prices.
