Crude climbed earlier on expectations that OPEC, supplier of 40 percent of the world's oil, will reduce output at an extraordinary meeting in Vienna this week. Iran, the group's second-largest producer, said it favors a cut of between 2 million and 2.5 million barrels a day.
Crude oil for November delivery fell as much as $2.08, or 2.8 percent, to $72.17 a barrel on the New York Mercantile Exchange, and was at $72.33 as of 1:15 p.m. in London. It earlier advanced $1.44 or 1.9 percent to $75.69.
Besides Iran, ministers from Algeria, Libya, and Qatar have said the Organization of Petroleum Exporting Countries will need to trim supplies when it gathers on Oct. 24 in Vienna.
Crude, down more than 50 percent from its July 11 record of $147.27 a barrel, has gained nearly 8 percent since Oct. 16 when OPEC moved forward the date of their extraordinary meeting, initially scheduled for November.
The organization may be unable to keep prices supported if it fails to properly implement any agreement reached this week, according to MF Global Ltd.
Gold, copper and soy beans also fell. Investors often sell crude and other dollar-priced commodities when the U.S. currency gains, undermining their use as an inflation hedge. The dollar climbed to $1.3177 against the euro, the strongest since March 2007, from $1.3344 late yesterday in New York.
Brent crude oil for December settlement fell as much as $1.87, or 2.6 percent, to $70.16 a barrel on London's ICE Futures Europe exchange, and traded at $70.30 at 1:15 p.m. London time.