Oil prices settled lower as U.S. industrial-linked factory orders dipped, while the dollar strengthened, making crude more expensive for non-American buyers.

Brent crude futures settled at $81.98 a barrel, shedding 86 cents, or 1.04%. West Texas Intermediate crude (WTI) settled at $75.77 a barrel, down 64 cents, or 0.84%.

While new orders for U.S. manufactured goods rose broadly in December, orders for industrial equipment and other machinery fell, according to the latest Commerce Department data.

A rebound in the dollar index , which hit a nine-month low earlier in the session on softer U.S. Federal Reserve rate hike bets, also weighed on oil prices, according to Jim Ritterbusch of Ritterbusch and Associates. A stronger greenback makes dollar-priced oil more expensive for holders of other currencies.