Brent hits five
Credit: Reuters/Eric Gaillard
A customer holds a nozzle to fill up his tank in a gasoline station in Nice December 5, 2014.
The chief executive of Kuwait's national oil company on Monday said oil prices were likely to remain around $65 a barrel for the next six or seven months, the latest indication that Gulf producers are ready to ride out plunging prices.
Brent has fallen over 40 percent since June with losses deepening in late November after the Organization of the Petroleum Exporting Countries (OPEC) decided not to cut its output target.
Since then, top oil exporter Saudi Arabia has reduced its monthly prices for crude it sells to the United States and Asia, a move that analysts say show it is stepping up its battle for market share.
'Short term sentiment is to remain weak for crude oil given the oversupply expected in 2015 and leveraged funds still have further selling to do before fund positioning returns to neutral,' ANZ analysts said in a note.
Brent crude for January delivery was down 43 cents at $65.76 at 0257 GMT (09:57 p.m. EST) on Tuesday - its lowest since October 2009.
On Monday, Brent dropped $2.88, over 4 percent, to settle at $66.19 a barrel - its third-largest one-day percentage loss this year.
U.S. crude fell 52 cents to $62.52 a barrel on Tuesday morning, after briefly hitting $62.25 - the lowest since July 2009. It dropped 4.2 percent, or $2.79, to end at $63.05 on Monday.
It is unclear how soon the price slump will slow the U.S. shale boom. The number of onshore rigs drilling for crude oil remains relatively high, and new U.S. projections released on Monday showed production from the big three U.S. shale plays should carry on growing at over 100,000 barrels per day into January.
However, many companies are already starting to make deep cuts to spending for next year. Conoco said on Monday it would slash spending by 20 percent, or $3 billion, the biggest reduction announced so far by U.S. drillers.
Asian markets were mostly in the red on Tuesday morning while the U.S. dollar began to edge higher once again aided by a media report the Federal Reserve might take a rhetorical step toward tightening at its meeting next week.
(Editing by Joseph Radford)
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