Crude oil dropped to a five-year low after the United Arab Emirates said OPEC wont rein in production in response to the slump.
The Organization of Petroleum Exporting Countries will refrain from curbing output even if prices fall as low as $40 a barrel, U.A.E. Energy Minister Suhail Al-Mazrouei said. Prices have fallen about 20 percent to the lowest in five years since OPEC decided against cutting production to tackle the glut at a Nov. 27 meeting. The group has pumped more than its output target of 30 million barrels a day for the last six months.
Oil fell into a bear market this year amid the highest U.S. production in three decades and slowing growth in global consumption. Futures rebounded earlier today on signs that output will decrease in Libya and Nigeria, which are responsible for about 9 percent of OPEC production.
West Texas Intermediate for January delivery declined 84 cents, or 1.5 percent, to $56.97 a barrel at 10:25 a.m. on the New York Mercantile Exchange. Futures touched $56.25 earlier, the lowest level since May 2009. Total volume was 67 percent above the 100-day average for the time of day.
Brent for January settlement slipped 23 cents to $61.62 a barrel on the London-based ICE Futures Europe exchange. The North Sea crude earlier slumped to $60.28, the least since July 2009. Volume was near the 100-day average. The European benchmark traded at $4.67 a barrel premium to WTI.