Oil prices slumped Thursday as investors locked in profits against the backdrop of a strengthening dollar, which discourages buying of the commodity. New York's main contract, light sweet crude for April delivery fell 73 cents to $82.20 a barrel. London's Brent North Sea crude for May delivery was down 48 cents to $81.48. “Some of it may be due to profit taking, and some of it may be due to the dollar being stronger,” said analyst Andy Lipow of Lipow Oil Associates. A stronger greenback makes dollar-denominated crude more expensive for buyers using weaker currencies. Analysts also said oil futures prices had risen too fast in recent days and did not reflect demand on the ground. “Prices are running ahead of fundamentals and remain disconnected from the physical market,” said Mike Fitzpatrick, vice president of MF Global. “The longing for real value can be the only rational explanation for rising oil prices,” he said, citing depressed consumer sentiment. “Commodity prices may continue to rise even as deflationary pressures mount. No matter how much liquidity is pushed into the banking system, until consumers go back to work, demand will remain tepid,” he said.
