Oil prices fell in early trading on Monday, pulled down by rising economic concerns in Asia and a related strengthening in the US dollar, which makes fuel imports for countries using other currencies more expensive.
International Brent crude oil futures fell back below $50 per barrel, trading at $49.89, down 65 cents, or 1.29%, from their last settlement.
US West Texas Intermediate (WTI) crude was down 78 cents, or over 1.5%, at $48.29 a barrel.
Economic sources said that oil was being pulled down by a sharp reduction in risk appetite and a US-dollar and treasuries rally.
The dollar has recovered some 1.3% from June lows against a basket of other leading currencies, pushed by the prospect of a potential hike in US interest rates and by concerns over Asia’s economy, which is dragging currencies there.
A stronger greenback makes dollar-traded oil imports more expensive for countries using other currencies, potentially hitting demand and weighing on prices.