NEW YORK (CNNMoney.com) -- Oil dipped to near $71 a barrel on Thursday as the dollar climbed to a three-month high against the euro.
"We had a strong dollar, and that was all about the fact that the Federal Reserve sent a very slight signal that we're seeing the light at the end of the tunnel when it comes to the economic stimulus," said Phil Flynn, a senior market analyst at PFG Best. "A strong dollar puts pressure on commodities."
Crude oil for January delivery fell 1 cent to settle at $72.65 a barrel after diving as low as $71.37 earlier. Prices climbed nearly 3% on Wednesday following an inventory report that showed an unexpected drop in oil supplies.
On Wednesday, the Fed said it would hold interest rates steady near 0%. In a statement accompanying the decision, Fed policymakers said they see market conditions improving. That helped push the dollar to its highest point since September.
The euro fell 1.3% to $1.435 against the greenback on Thursday after Standard & Poor's downgraded Greece's credit rating. This followed a downgrade by Fitch just over a week ago, when health care companies complained that the country was behind on public health care-system payments.
"People were buying the dollar because of both good news and bad news today," Flynn said. Some investors saw the Fed's statement as a positive signal for the economy, and others bought the dollar as a safe haven because they were worried about another credit crisis overseas.
Gasoline prices. The national average price for a gallon of regular unleaded gas fell to $2.590, down four tenths of a cent from the previous day's price of $2.594, according to motorist group AAA. This is the ninth consecutive day prices have declined.
|Overnight Avg Rate||Latest||Change||Last Week|
|30 yr fixed||3.43%||3.40%|
|15 yr fixed||2.70%||2.67%|
|30 yr refi||3.45%||3.43%|
|15 yr refi||2.71%||2.71%|
Today's featured rates:
Southwest pilots have been negotiating pay raises and improved contract terms with the airline for more than four years. Now, there's a sign the gridlock is ending. The union said Monday they've reached an 'agreement in principle.' More
Nearly 10,000 current and former Chipotle workers have joined a class action lawsuit alleging the company forced them to work 'off the clock' without pay. More
Chicago will begin tracking air quality, weather and road data to better inform government decisions. More
In 1998, Ntsiki Biyela won a scholarship to study wine making. Now she's about to launch her own brand. More
Following an order from the Department of Education to stop admitting students on federal financial aid, the for-profit technical school has stopped enrolling new students. More