Oil Drops to One-Week Low on Libyan Rebel Advance, Fed Policy

Crude oil dropped to the lowest price in a week in New York as the advance of Libyan rebels against Muammar Qaddafi’s troops spurred hope that the conflict in Africa’s third-largest oil producer may end soon.

Futures fell as much as 1.2 percent after Libyan government troops prepared to block advancing rebels at Sirte, Qaddafi’s hometown. Crude extended losses after St. Louis Federal Reserve President James Bullard indicated that the Fed may tighten monetary policy soon, fanning speculation demand growth may falter in the U.S., the world’s biggest oil consumer.