Crude futures retreated Friday from the record level set earlier this week, with the dollar's recovery against the euro at least temporarily capping oil's recent gains even as retail gasoline prices hit a new high, according to AP. Light, sweet crude for May delivery fell 73 cents to $109.38 on the New York Mercantile Exchange after briefly having topped $110 per barrel in electronic trading. Analysts attributed the drop to traders looking to lock in strong prices before the weekend, as well as the dollar's rise against the British pound. «The main thing I see is just profit-taking after we ran things up to record high,» said Jim Ritterbusch, president of Ritterbusch & Associates in Galena, Illinois. «There's a strong possibility we'll see new record highs again next week.» Comments by Nobuo Tanaka, head of the International Energy Agency, also added «a bearish note,» said Vienna's JBC Energy, alluding to his forecasts of a more balanced market amid softening demand. An unexpected decline in U.S. crude and gasoline inventories drove oil prices to a trading record of $112.21 a barrel on Wednesday amid concerns about inadequate supplies ahead of the Northern Hemisphere summer driving season. Prices fell Thursday. Crude oil's recent run above $100 a barrel has been largely attributed to the steadily depreciating dollar. A weakening dollar attracts investors to commodities as a hedge against inflation, but when the dollar rises, the effect tends to reverse as oil also becomes more expensive to investors overseas.
