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Oil takes a hit as Libya, rebels strike accord to ease blockade

U.S. oil futures briefly dipped below $100 on Monday, with Brent crude prices losing even more on the prospect of additional supplies from Libya.

Wall Street's S&P 500 stock market index looked to be on track for its biggest three-day drop in two months, pushed down by shares of fast-growing industries, or momentum shares, and by disappointment with U.S. jobs data issued on Friday.

U.S. and Brent crude also took a hit on Monday from an agreement by Libyan rebels occupying four eastern oil ports to end an eight-month blockade. The Zueitina oil port said it was ready to load crude as early as Monday.

Source: Denver International Airport

fell $1 to stay under $106. U.S. crude oil traded on the NYMEX fell by 70 cents, closing at $100.44 after falling under $100 at one point. Both contracts traded within a relatively narrow range, which analysts said reflected investor uncertainty about the Libyan deal holding. The fall in oil prices snapped a two-day rise.

Under the deal thrashed out over the weekend, Libya's Zueitina and Hariga ports, held by federalist rebels demanding more autonomy from Tripoli, are to open almost immediately. The larger ports of Ras Lanuf and Es Sider will be freed up in two to four weeks after more talks. The end to the port standoff is removing some supply worries that had helped push prices as high as $112.

Crude oil may be come under further pressure in the coming days when Iran and six world powers hold new talks in Vienna, intending to reach agreement by July 20 on how to resolve the decade-old standoff over Iran's nuclear program.

Iran said it hopes to make enough progress in the talks for negotiators to start drafting an agreement by mid-May. Sanctions against Tehran have kept much Iranian oil off international markets.

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