Oil prices fell to fresh 5-1/2 year lows on Tuesday, extending losses after a 5 percent plunge in the previous session as worries over a global supply glut intensified.
Brent crude fell close to $51 a barrel, its lowest since 2009, with cuts to Saudi Arabia’s official selling prices to Europe this week adding more pressure to the 55 percent price rout since June.
Saudi Arabia’s King Abdullah said in a speech read for him on Tuesday the country would deal with the challenge posed by lower oil prices “with a firm will” but gave no sign the world’s top exporter was considering changing its policy of maintaining production in the face of fast-growing U.S. shale supplies.
“We would need an indication that Saudi Arabia is considering output cuts,” said Carsten Fritsch, a commodities analyst with Commerzbank.
The Saudi official price cuts on Monday added to bearish data over the weekend showing that Russia’s 2014 oil output hit a post-Soviet-era high and December exports from Iraq, OPEC’s second-largest producer, reached their highest since 1980.
Brent crude LCOc1 fell as low as $51.23 a barrel on Tuesday, its lowest level since May 2009. It recovered slightly to $51.95 at 1310 GMT (0810 ET), down $1.16 on the day.
U.S. crude CLc1 was at $48.94, down $1.10, after falling to $48.47, its lowest since April 2009.
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