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Oil near $92 as Cyprus rejects bailout measure

Tuesday - 3/19/2013, 10:50pm  ET

NEW YORK (AP) -- The price of oil fell Tuesday as Cyprus lawmakers rejected a measure to tax bank accounts as part of a bailout plan for its shriveled economy and worries persisted about Europe's debt problems.

Benchmark oil for April delivery fell $1.58 to finish at $92.16 a barrel on the New York Mercantile Exchange. Brent crude, used to price many kinds of oil imported by U.S. refineries, dropped $2.06 to end at $107.45 per barrel on the ICE Futures exchange in London.

Energy market investors were left hanging about developments in Cyprus, where lawmakers rejected a plan to tax bank accounts to stabilize the country's financial sector and clear the way for a massive international bailout. That has prompted fears of a run on banks across Europe, with accountholders questioning guarantees on their savings.

Analysts at Frankfurt's Commerzbank, while noting that "the upside potential is likely to remain limited" until the uncertainty over Cyprus subsides, also pointed out that the lack of alternative investment opportunities could support crude prices.

"The continuing high liquidity among investors, coupled with their willingness to take risks, is likely to lend support also to the commodities markets in the coming months," Commerzbank said.

Meanwhile, the economic news in the U.S. was brighter. The Commerce Department said builders broke ground on homes last month at a seasonally adjusted annual rate of 917,000, up from 910,000 in January and the second-fastest pace in 4
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