The largest exchange traded fund indexed to oil futures is down 30% from its March 1 peak with crude prices tumbling under $80 a barrel on Thursday as the U.S. dollar rebounded.

The $1.2 billion U.S. Oil Fund (NYSEArca: USO) fell 2.5% in afternoon trade. Since the ETF invests in crude futures, it won’t perfectly track the spot price.

Lower oil prices are great for consumers at the gas pump, but tumbling crude prices signal concerns over global economic demand and deflation.

In currency markets, PowerShares DB US Dollar Index Bullish (NYSEArca: UUP) gained nearly 1% Thursday. A rising dollar generally punishes commodity ETFs, including oil and gold funds. [Dollar ETF Breaks Out in May]

The dollar has been trending lower this month after the May spike. Meanwhile, crude oil prices have traded in a range in June following the previous month’s sell-off.

Kimble Charting Solutions reports that the dollar is breaking above a 10-year resistance line and putting strong downside pressure on precious metals and oil.

U.S. Dollar Index

U.S. Oil Fund

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