Oil Price Retreats From $126/Barrel

From last week $126.96 a barrel due to weak dollar, oil price is getting its way down, this time, is due to a strong dollar.

The advance at the end of last week came after Colombia said it recovered documents from a slain guerrilla that indicate Venezuelan President Hugo Chavez has offered assistance to Colombian rebels. Some U.S. lawmakers have cited the documents to argue that the White House should add Venezuela to a list of state terror sponsors that includes North Korea, Iran, Syria, Sudan and Cuba.

"We see this as having continued upward pressure on the demand for oil world wide", cited a senior trader at Global Options, one of the largest commodities traders.

Such a move would most likely spur Venezuela to cut off oil exports to the U.S., but analysts believe such a provocative diplomatic step is unlikely.

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