Oil prices wavered on Tuesday as a rising dollar kept crude from moving higher, as fresh economic data gave mixed signals on whether demand for oil will increase.
Benchmark crude for December delivery was down 43 cents to $78.47 a barrel on the New York Mercantile Exchange. The contract rose $2.55 to settle at $78.90 on Monday.
The euro dropped back below $1.49 on Tuesday after banking officials in Europe and the U.S. voiced support for the dollar.
Because crude is traded in dollars it gets cheaper when the dollar declines. That has helped move oil higher this year after it bottomed at $32 a barrel nearly a year ago.
At the same time, industrial production for October rose less than expected, suggesting that the economic recovery — and oil demand — will continue to be bumpy.
Even with Monday's strong gain, oil has traded in a range of $75 to $82 for the past several weeks.
Demand for oil continues to be weak and supplies are more than ample, and that is keeping oil prices restrained as prices for other commodities, such as gold, continue to climb because of the weaker dollar, PFGBest analyst Phil Flynn said.
Traders also are waiting for the government's weekly oil inventory report on Wednesday. Analysts expect an increase in crude and gasoline stocks and a decline in distillates used to make heating oil and diesel fuel, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.
This week's numbers may be skewed by Hurricane Ida, which shut down some oil and gas production in the Gulf of Mexico for a couple of days last week.
Retail gasoline prices fell 0.4 cent overnight to $2.627 a gallon, according to AAA, Wright Express and Oil Price Information Service. Prices are 8 cents higher than a month ago and 54 cents higher than a year ago when oil prices were sliding.
In other Nymex trading, heating oil rose 0.1 cent to $2.0330 a gallon. Gasoline for December delivery dropped 0.32 cent to $1.9836 a gallon. Natural gas for December delivery was unchanged at $4.614 per 1,000 cubic feet.
In London, Brent crude for December delivery fell 41 cents to $78.35 on the ICE Futures exchange.
