Oil price drops to near $95 a barrel

Oil prices fell Friday after news reports suggested the U.S. might tap its strategic reserves to slow the rising price of oil.

Benchmark crude for September delivery was down 42 cents to $95.18 per barrel at midday in London in electronic trading on the New York Mercantile Exchange. The contract rose $1.27 to finish at $95.60 per barrel in New York on Thursday.

Brent crude was down $1.51 to $113.74 per barrel on the ICE Futures exchange in London.

Analysts said oil prices did an about-face after three days of gains following reports that the U.S. was gearing up for a move to keep a lid on prices.

"Overnight the trigger for the weakness was, potentially, news reports that the U.S. will consider releasing strategic petroleum reserves, and that seems to be weighing on the market," said Nick Trevethan, senior commodities strategist at ANZ Research in Singapore.

Oil analysts at Commerzbank suggested that the Obama administration might be looking for a way to keep oil prices from skyrocketing. Obama is running for re-election in a bruising presidential contest.

"In the past two months, US gasoline prices have soared 20 percent on the back of higher oil prices and lower gasoline stock levels," the Commerzbank team said.

In other energy futures trading, gasoline was steady at $3.08 a gallon and heating oil was off 3 cents at $3.10 a gallon. Natural gas was steady at $2.724 per 1,000 cubic feet.