Oil prices slipped Tuesday after climbing to a new record of almost $104 a barrel a day earlier and then falling back as traders booked profits.
The decline came as it appears OPEC ministers, gathering for a meeting Wednesday, have all but ruled out pumping more oil to ease record-high prices.
Chakib Khelil, president of the Organization of Petroleum Exporting Countries, said the 13-nation cartel is shying away from boosting production because of the U.S. economic slowdown, political turmoil in the Middle East and expectations of slackening global demand for crude.
Light, sweet crude for April delivery on the New York Mercantile Exchange fell 45 cents to $102.00 a barrel in electronic trading by midday in Europe. The contract traded as high as $103.95 a barrel Monday before retreating to settle at $102.45, up 61 cents from the end of last week.
Oil futures — propelled by the weak U.S. dollar — climbed past $103.76 a barrel Monday on the New York Mercantile Exchange, breaking what many analysts consider to be the true record high for oil after the $38 per barrel price from 1980 is adjusted for inflation.
Oil's most recent run into record territory has been driven by the dollar's slump against other world currencies.
The dollar's decline to historic levels Monday was spurred by news that construction spending in the U.S. took its biggest nosedive in 14 years.
Crude futures offer a hedge against a falling dollar, and oil futures bought and sold in dollars are more attractive to foreign investors when the dollar is falling. Gold, copper and wheat are among the other commodities that have rallied as the dollar has fallen.
Investors are also keeping an eye on Wednesday's OPEC meeting. Most expect the Organization of Petroleum Exporting Countries to hold output steady.
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