Oil in New York traded near a five-year low as Russia reiterated that it will keep crude production steady next year, mirroring OPEC’s strategy to refrain from curbing supply to tackle a global surplus.
Futures fell as much as 2.4 percent after sliding below $54 a barrel yesterday for the first time since May 2009. Output from Russia, the world’s largest crude producer, will be similar to this year’s 10.6 million barrels a day, according to Energy Minister Alexander Novak. Iran is said to be offering shipments to Asia at the deepest discount in at least 14 years, taking a cue from Saudi Arabia in cutting price differentials.
Oil has slumped 44 percent this year as a surge in shale drilling lifted U.S. output to the fastest pace in three decades amid slowing world demand growth. Leading members of the Organization of Petroleum Exporting Countries such as Saudi Arabia have resisted calls from smaller producers including Venezuela and Ecuador to reduce quotas to stem the price rout.