U.S. crude oil futures regained upward momentum on the New York Mercantile Exchange Monday as the dollar weakened against a basket of major currencies, global equity markets recovered and the S&P 500 soared to a four-month high on Wall Street.

Riding the coattails of a stellar S&P 500 performance, benchmark crude futures for October delivery rebounded $1.20, or 1.6%, from Friday's negative settlement to close higher at $74.86 per barrel. Additionally, the six-month strip for WTI crude oil gained $1.09 Monday, closing at $78.10 per barrel, or 1.4% higher than a previous settlement price of $77.02 per barrel. Likewise, the 12-month strip for WTI crude pushed through an $80 resistance area to close 1.2% higher at $80.12 per barrel.

On Friday, oil prices tumbled to a two-week low due to speculation that the U.S. economic recovery appeared to be slowing—once more—which could potentially weaken nascent fuel demand in the world’s biggest oil consumer, according to Global Hunter Securities research director Michael Bodino. Oil futures slipped 3.6% in the week to Sept. 17, and have declined roughly 7% in 2010, Bodino said in a Sept. 20 industry brief.

Adding downward pressure on oil and gas prices Friday, Hurricane Karl steered clear of oil and gas producing infrastructure in the northern Gulf of Mexico before making landfall in Mexico. Previous forecasts for higher-than-normal tropical activity had provided short-term support for energy prices; however, national forecasts for the 2010 Atlantic hurricane season have since been reduced from 20 to 14 named storms due to limited developments during the first two months of the season, Bodino noted.

Meanwhile, the oil market is turning its attention to the upcoming Federal Reserve meeting on Sept. 21. The Federal Reserve—which has already dropped interest rates to near zero and has issued some $1.7 trillion from treasury bonds to stimulate the flagging economy—is not expected to take new steps to ease monetary policy, according to a report by Reuters.

On the opposite side of the energy coin, October spot prices at the Henry Hub reversed course from last week’s rally above a $4 threshold, paring an additional 5% from Friday’s negative settlement to close lower at $3.82 per thousand cubic feet. Despite the E&P industry’s push to lower the gas-drilling rig count to revive flailing prices, natural gas remains undervalued as the market enters a “softer” season for demand.