The price of oil fell to near US$98 a barrel Monday after Crimea voted to split from Ukraine and join Russia, a development already anticipated by investors.
The vote triggered sanctions by the EU and U.S. against Russia, but none that affected the country's energy industry.
Benchmark West Texas Intermediate crude for April delivery fell 81 cents to close at US$98.08 on the New York Mercantile Exchange.
Brent crude, used to set prices for international varieties of crude, dropped $1.97 to US$106.24 a barrel on the ICE Futures exchange in London.
Crimea's parliament on Monday declared the region an independent state, following its residents' overwhelming decision in a referendum held Sunday to break away from Ukraine and seek to join Russia. The United States, the European Union and others said the vote violated the Ukrainian constitution and international law.
EU foreign ministers announced travel bans and asset freezes on 21 individuals seen pushing for the secession and possible annexation of the Crimean peninsula. While Russia is a major oil and gas producer, sanctions are not seen stretching that far for now.
For Russia, around 70 per cent of export revenues come from energy sales, analysts said.
Natural gas rose 11 cents to US$4.54 per 1,000 cubic feet as forecasts call for cooler than normal temperatures in the northern parts of the U.S. through the end of March.
In other energy futures trading on Nymex, wholesale gasoline fell eight cents to US$2.88 a U.S. gallon (3.79 litres) and heating oil dropped five cents to US$2.89 a gallon.
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