Oil prices drop, dollar rises

Oil lost more than $2 a barrel Monday as another move by China to slow its booming economy and a stronger dollar pushed prices down.

Benchmark West Texas Intermediate crude fell $2.79, or 2.1 percent, to $106.87 in morning trading on the New York Mercantile Exchange.

China's central bank raised reserve requirements for banks in an attempt to slow inflation. That raised concerns that demand for oil would drop. China is the world's second largest oil consumer behind the U.S.

News that Saudi Arabia, the world's largest crude producer, had cut its oil output also pushed down prices.

The dollar rose against other currencies. Since oil is traded in dollars, a stronger dollar makes it less attractive to buyers with foreign currencies and the price generally falls.