OIL extended losses below $50 (R588) a barrel amid speculation that US crude inventories will expand, exacerbating a global supply glut that has driven prices to the lowest level since April 2009.
Futures fell as much as 3.1 percent in New York, declining for a fourth day. Stockpiles in the world’s biggest oil consumer probably rose by 750 000 barrels last week.
Oil fell almost 50 percent last year, the most since the 2008 financial crisis, after Opec resisted calls to cut output as it competes with US producers.
The market faces “more problems” this year, according to Morgan Stanley, with surging output in Russia and Iraq contributing to a surplus that Qatar estimates at 2 million barrels a day.
West Texas intermediate for February delivery dropped as much as $1.57 to $48.47 a barrel in electronic trading on the New York Mercantile Exchange, the lowest since April 2009, and was at $48.86 by 10.35am London time.
Brent for February settlement decreased as much as $1.88 to $51.23 a barrel on the London-based ICE Futures Europe exchange, the lowest since May 2009. – Bloomberg