NEW YORK (AP) -- Crude oil prices accelerated their decline Monday, joining a wider commodity selloff, while natural gas prices rose as lingering cool temperatures kept demand strong.
Light, sweet crude for May delivery tumbled $4.46 to $101.16 a barrel on the New York Mercantile Exchange, adding to a drop of nearly $2 a barrel on Friday.
The decline came as traders sold off a broad range of commodities, from precious metals and gasoline to pork bellies and soybeans. The price of gold, for instance, dropped $16.50 to $914.10 on the Nymex.
Speculators have poured money into commodities in recent weeks as a hedge against inflation and a weakening dollar, which neared its all-time low against the euro Monday.
But as the first quarter came to a close and contracts for heating oil were set to expire, traders unwound some of those trades. Market observers said the sales may have been to settle open future positions and lock in profits, or simply because of a lack of headlines that would entice fresh buying.
"We've seen some ... air come out of the bubble," said Phil Flynn, an analyst at Alaron Trading Corp. in Chicago. "We may see some confidence return to the dollar, and all this money that embraced commodities as a hedge could go away."
Meanwhile, natural gas for May delivery jumped 25 cents, or 2.6%, to $10.050 per 1,000 cubic feet on the Nymex.
Jim Ritterbusch, president of Ritterbusch & Associates in Galena, Ill., said supplies of the heating, cooking and power-generation fuel typically increase at this time of year as warmer springtime temperatures slow demand.
"That process is going to be delayed this year due to the cold weather," he said. "We've virtually erased a huge supply surplus that existed at the beginning of winter."
Analysts are split on oil's direction. Many think prices will rise to new records in coming months as the dollar weakens further, but others say such high prices can't be sustained.
"We have huge speculative positions in oil," said Flynn, who believes prices are likely to move lower. "Some may call it a bubble, some may just call it overbought."
The dollar sank as low as $1.5895 against the 15-nation euro - just shy of its March 17 record of $1.5904 - before strengthening to $1.5806 later in the day.
Crude prices were also responding to reports of relative calm in Iraq, where two attacks on oil pipelines last week had raised concerns about a plunge in Iraqi exports.
In the southern oil city of Basra, Anti-American Shiite cleric Muqtada al-Sadr has ordered his fighters to stand down. Meanwhile, a top Shiite Muslim cleric in Lebanon who was born in Iraq and holds some sway with Iraq's Shiites issued a religious edict prohibiting attacks on Iraq's oil industry and other public infrastructure.
"The risk of another [pipeline] explosion is a little bit less, at least in the view of the market," Flynn said.
At the pump, gasoline prices edged a tenth of a penny higher to $3.287 a gallon, according to AAA and the Oil Price Information Service.
In other Nymex trading, heating oil futures fell 4.6 cents to $3.059 a gallon, while gasoline futures sank 11.7 cents to $2.60 a gallon. Brent crude futures fell $4.34 to $99.43 a barrel on the ICE Futures exchange in London.
First Published: March 31, 2008: 7:01 AM EDTGas prices strike all-time high
Diesel: The truck stops here