Oil rises above $97 a day after price plunge

Associated Press Modified: September 18, 2012 at 12:00 am •  Published: September 17, 2012
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BANGKOK (AP) — Oil rose above $97 a barrel Tuesday in Asia, clawing back some losses after prices unexpectedly took a plunge the day before.

Benchmark crude for October delivery was up 44 cents at $97.06 a barrel at midday Bangkok time in electronic trading on the New York Mercantile Exchange. The contract fell $2.38, or 2.4 percent, to finish at $96.62 a barrel on the Nymex on Monday.

On Monday afternoon in the U.S., oil suddenly plunged more than $4 per barrel, erasing the gains made last week when the Federal Reserve unveiled new steps to boost the U.S. economy.

Traders were initially unsure of the cause of the plunge. Some wondered whether an errant trade or another rumor about a release of oil from the Strategic Petroleum Reserve was to blame. NYMEX operator CME Group said there were no technical glitches to explain the drop.

Oil analyst Stephen Schork said volatility arising from the expiration of October options contracts could have been exaggerated by the lower trading volume that occurred Monday due to the observance of a Jewish holiday.