Oil Price Falls on Europe Worries

Tomahawk, WI 11/1/2011 (StreetBeat) – Oil is falling with the stock market as a surprise referendum in Greece threatens to derail a plan to bolster Europe's banks.

Benchmark crude on Tuesday morning fell $2.26, or 2.4 percent, to $90.94 per barrel in New York, while Brent crude lost $2.40 to $107.16 in London.

Prices dropped after Greece's prime minister called a referendum in his country on Europe's debt deal. If Greeks reject the debt deal, it would increase the chances the country would default on its debt. That would weaken banks in surrounding countries and slow down the European economy.

Stocks sold off, with the major indexes down more than 1.5 percent.

Meanwhile, U.S. retail gasoline prices fell less than a penny to a national average of $3.437 per gallon.

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