Oil plunged suddenly Monday afternoon, dropping more than US$4 per barrel at one point in a dramatic end to an otherwise quiet trading day in New York.
Benchmark crude fell $2.38, or 2.4 per cent, to finish at $96.62 on the New York Mercantile Exchange. That's the biggest percentage decline since July 23. Oil plunged below $95 per barrel during the sell-off.
Traders were unsure of the cause of Monday's price drop. Some questioned whether an errant trade or another rumour about a release of oil from the Strategic Petroleum Reserve was to blame.
The White House has been considering tapping the Strategic Petroleum Reserve to stem the rising cost of crude and gasolene. A little over a week ago, Reuters reported the Obama administration was considering a release much larger than the 30 million barrels from last year.
Oil rose 2.7 per cent last week after getting a boost from the US Federal Reserve's latest plan to boost the US economy. It held to slight gains above $99 for most of Monday.
Brent crude, which is used to price international varieties of oil, fell sharply as well. Brent lost $2.91, or 2.9 per cent, to $113.77 on the ICE Futures Exchange in London.