NEW YORK — Oil prices pulled back Tuesday after the previous session’s wild, record-setting rally, dropping below $107 a barrel as uncertainty over the U.S. financial bailout plan and a stronger dollar led investors to shed commodities.
It was crude’s first down session in five days. Some decline was to be expected after crude soared 16 percent Monday — the biggest one-day gain ever.
Still, oil-market watchers say crude is showing early signs that it may be poised for another big climb. They say tightening global supplies, weakness in the dollar and nervousness about the U.S. government’s $700 billion financial rescue plan could soon prompt edgy investors to shift funds out of equities and send a burst of capital back into haven commodities such as oil — potentially pushing prices back toward record levels and causing consumers more pain at the pump.
Oil is up $15 in the past week, momentarily halting a two-month slide from the all-time high of $147.27 a barrel reached July 11.
“We could be back on the road toward $150 a barrel,” said Stephen Schork, an analyst and oil trader in Villanova, Pa.
But highlighting the uncertainty in the oil market, other analysts said it’s just as possible that prices could go lower.
Light, sweet crude for November delivery fell $2.76 to settle at $106.61 on the New York Mercantile Exchange. The October contract, which expired Monday, surged as much as $25.45 to $130 a barrel before falling back to settle at $120.92.
