Oil prices continued to fall Monday as a strengthening dollar and signs of dropping demand offset the supply concern caused by Russia-Georgia tension.
Light, sweet crude for September delivery fell 75 cents to settle at 114.45 U.S. dollars a barrel on the New York Mercantile Exchange.
Crude futures gained over the weekend as the conflict between Russia and Georgia in South Ossetia caused concerns about the potential disruptions of pipelines in the area. Price rose to 116.90 dollars a barrel in the early morning trading.
But the bullish mood changed after a cease-fire was proposed and different factors brought oil prices to as low as 112.72 dollars a barrel.
The dollar gained strongly against the euro and the sterling pound Monday, which reduced the crude's appealing as the hedge against inflation.
Concerns that high energy prices have taken a toll on consumption still weighed on the market. Investors turned their attention Monday to a report that China's crude oil imports had fallen 7 percent to 13.79 million tons in July, down from 14.83 million tons 12 months earlier.
Meanwhile, Iranian state-run media said Iran's chief nuclear negotiator agreed to a new round of negotiations with the European Union about its nuclear program, which helped to ease pressure from crude oil.
In London, Brent crude for September delivery fell 66 cents to settle at 112.67 dollars a barrel on the ICE Futures Exchange.