Crude oil prices plunged more than $3 Thursday on the back of a strengthening dollar and a build in crude supplies, according to The Associted Press. Crude prices have jumped about 80 percent in one year but Thursday, light, sweet crude for June delivery stalled in its march toward $120 a barrel, falling $3.31 to $114.99 a barrel on the New York Mercantile Exchange. Analysts said the dollar's rise against the euro gave investors a chance to lock in profits from oil's recent record run. Investors see commodities such as oil as a less effective hedge against inflation when the dollar strengthens, and a stronger greenback makes oil more expensive to investors overseas. In London, June Brent crude futures slid $3.18 to $113.28 a barrel on the ICE Futures exchange. Analysts believe the dollar is gaining ground on speculation the Federal Reserve is growing concerned about inflation, and may not cut interest rates as much as once thought. Higher interest rates tend to stabilize or strengthen the dollar. «There's a lot of cry out there right now to stop cutting rates,» said James Cordier, president of Tampa, Florida, trading firms Liberty Trading Group and OptionSellers.com. Phil Flynn, an analyst at Alaron Trading Corp. in Chicago, said the resolution of a one-day strike by oil workers in Nigeria, a major U.S. supplier, also pushed oil prices lower. But few analysts are willing to predict that oil's record run is over. Investors remain concerned about tight supplies of oil amid growing global demand, they say. Oil production is falling in Russia and Mexico, while «global growth in China, India, Russia and Brazil is tapping additional oil,» Cordier said. That could spell additional records for oil, and more pain for consumers. June crude futures are trading a few dollars below the record high near $120 hit by May crude futures earlier this week; the expiring contract attracted buying from investors scrambling to square bets. But concerns about supplies, or a downturn in the dollar, could easily push crude to $125 or $130 a barrel in short order, Cordier said. In other Nymex trading Thursday, May gasoline futures fell 6.69 cents to $2.9838 a gallon, and May heating oil futures fell 8.17 cents to $3.2433 a gallon. May natural gas futures fell 14.1 cents to $10.64 per 1,000 cubic feet. The Energy Department said inventories grew last week by 24 billion cubic feet, less than analysts expected.
