NEW YORK: The price of oil has dipped below USD 45 a barrel following the latest sign from OPEC that the group doesn't plan to cut production.
The comments from the energy minister for the United Arab Emirates, a member of OPEC, put more downward pressure on crude today. The comments reaffirmed the position of OPEC's Arab Gulf members that lowering production would only erode their market share and benefit rivals, such as shale drillers in the US.
Last November OPEC decided to keep production levels steady.
That decision came despite calls from some from within the 12-member bloc to curb output in an effort to boost prices.
The price of US benchmark crude traded as low at USD 44.20 a barrel early, the lowest since April 2009. The price has dropped since last June, when it reached USD 107.
In late morning trading on the New York Mercantile Exchange, US crude was down 34 cents, or 0.8 per cent, to USD 45.72. Brent crude, the international benchmark, fell USD 1.41, or 2.9 per cent, to USD 47.28 a barrel in London.
Oil prices have continued to fall in the new year. Already US crude is down 15 per cent for 2015, and Brent is off 18 per cent.
Analysts at Ritterbusch and Associates are forecasting that US crude will go as low as USD 40.25 a barrel.
The analysts wrote in a note to investors today that they see "little support" for oil this week, partly because they expected a report tomorrow to show larger-than-normal increases in oil supplies.