NEW YORK (Dow Jones)--Crude prices fell slightly Thursday, with market participants taking profits, although a late-day weakening in the dollar helped oil erase some of its earlier losses.

Light, sweet crude for December delivery settled 18 cents, or 0.2%, lower at $81.19 a barrel on the New York Mercantile Exchange, having briefly dipped to an intraday low of $79.86 a barrel. Brent crude on the ICE futures exchange settled 18 cents, or 0.2%, lower at $79.51 a barrel.

Oil prices were under downward pressure through much of the session. Following Wednesday's rally to $82 a barrel, some market participants chose to take profits on bets they had placed earlier that oil would rise. Oil prices were driven up by a draw in U.S. gasoline stocks for the second week running, as well as a weakening in the dollar to a 14-month low against the euro.

"We've seen profit-taking with not much in the way of fresh news," said Jim Ritterbusch, of Ritterbusch and Associates in Galena, Ill.

A strengthening in the dollar against the euro had weighed on prices for much of the day, as this made crude more expensive to purchasers that are holders of other currencies. Oil prices briefly traded below $80 a barrel, but rebounded toward the end of the trading day as the dollar began a retreat toward its recent lows.

"The main driver of the price (of oil) is still the dollar and more weakness going forward will help us see higher prices," said Ritterbusch.

Meanwhile, the Organization of Petroleum Exporting Countries gave an early sign that it could decide to raise output in December. Secretary General Abdalla Salem el-Badri said that the decision to increase production would come only "if we see the (inventories) go back to the normal level, if we see there is a real world economic growth."

His comments, however, had little impact on the direction of oil.

"The market can't take note because the statement was so heavily qualified by the ifs," said Tim Evans, an analyst with Citi Futures Perspective in New York.

He observed that even without a policy change, OPEC has been increasing production throughout this year, and is currently running around 1.5 million barrels a day above its output quota.

"The market has been happy to move higher despite that rising production," said Evans.

Front-month November reformulated gasoline blendstock, or RBOB, settled 1.01 cents, or 0.5%, lower at $2.0442 a gallon. November heating oil settled 1.07 cents, or 0.5%, lower at $2.0946 a gallon.


More information on settlements and highs and lows for futures on Nymex and ICE platforms can be found by searching for the following headlines:


Nymex Light Crude Oil Close
Nymex Harbor RBOB Gasoline Close
Nymex Heating Oil Close
ICE Brent Crude Oil Close
ICE Gas Oil Close

-By Claire Rangel, Dow Jones Newswires; 212-416-2453; claire.rangel@dowjones.com