Oil fell sharply to below $67 in Asian trade today amid conflicting signals about the prospects of an early rebound for the struggling global economy.
A decline in world stocks further weighed on the oil market, while a stronger $ prompted traders to lock in profits from a recent rally that saw prices climb past $73, analysts said.
The July contract settled at $66.93 as it expired Monday.
Brent North Sea crude for August delivery dropped 98 cents to $66.00.
Traders said concerns that a global economic recovery may come later than expected are dampening sentiment, with the sharp fall in US stocks overnight a grim reminder of the hurdles ahead.
Asian stocks were also tumbling today.
"The main driver of oil has gone beyond traditional measures of just supply and demand and has metamorphisised into a macroeconomic force that at times measures the state of the global recovery and other times becomes a safe haven from $ or inflation or systemic risk," said Phil Flynn of Alaron Trading.