Crude Prices Down Six Percent

Oil prices fell more than $1 on Monday, knocked back by the United States' decision to tap into strategic reserves to bring a halt to this year's price rally and ensure sufficient supplies this winter.

U.S. benchmark crude futures for November delivery fell $1.82 - or nearly six percent to an early intra-day low in Asia of $30.86 per barrel, before rebounding to $31.44 for a loss from Friday of $1.24.

Prices were expected to retreat after President Bill Clinton gave the okay on Friday to release 30 million barrels of crude over 30 days from the 571 million-barrel Strategic Petroleum Reserve (SPR), although some analysts said the impact would be limited.

Clinton's authorization came ahead of an Organization of the Petroleum Exporting Countries (OPEC) heads-of-state summit in Caracas, Venezuela this week. OPEC will implement its own output hike of 800,000 barrels per day (bpd) from October 1. Oil is already well down from a post-Gulf War peak at $37.80 set last week and fell more than $1.30 in New York on Friday in anticipation U.S. oil reserves would be released.