Crude oil price slide continues

Recent gains on Brent crude reversed as it traded near $57 a barrel with the glut of oil that has halved prices since June overshadowed investors repositioning at the start of the year for an eventual recovery.

Brent has fallen to its lowest since 2009 as top exporter Saudi Arabia and other large Gulf producers have declined to cut production in the face of fast-growing US shale oil output, despite pleas from other OPEC members. Traders said a number of buy orders would have been placed ahead of the start of the new year’s trading, with some willing to bet prices will bounce this year as expensive oil projects are potentially shuttered or cancelled.

Prices faced pressure after a senior Libyan oil official said a major fire in an oil storage tank at the North African country’s largest crude export port had been extinguished.

Iraq, the second-largest producer in OPEC, said exports had averaged the highest since 1980 in December, reaching 2.94 million barrels per day.

Iran’s deputy foreign minister called on its regional rival Saudi Arabia to take action to support oil prices, saying producer countries across the Middle East will be hurt unless the slump is reversed.

Brent for February settlement dropped 91 cents, or 1.6 percent, to close at $56.42 a barrel on the London-based ICE Futures Europe. It is the lowest settlement since April 30, 2009. Volume for all futures traded was 34 percent below the 100-day average. The European oil fell 48 percent last year, the second-biggest annual loss on record behind a 51 percent tumble in the 2008 financial crisis. Brent closed at a $3.73 premium to WTI.

The surge in supplies in Iraq and Russia signaled no respite in early 2015 from the glut. Russian output rose 0.3 percent in December to a post-Soviet record of 10.667 million barrels a day, preliminary data e-mailed today by CDU-TEK, part of the Energy Ministry, showed. Iraq exported 2.94 million barrels a day in December, the most since the 1980s.

US oil production averaged 9.12 million barrels a day in the week ended December 26, according to the Energy Information Administration. Output increased to 9.14 million a day through December 12, the most in weekly data that started in January 1983.