Crude oil futures dropped below the $61-a-barrel mark Monday afternoon, erasing earlier gains after Saudi Arabia said a cut in output will not be in the near future and production could even be increased.
Ali Al-Naimi, oil minister of Saudi Arabia, said the kingdom will not cut its current output of 9.7 million barrels a day to prop up prices, an added that it is also willing to increase output to win obtain market share if new demand arises.
This comes a day after Al-Naimi said lower prices of crude oil would benefit demand by boosting the economy.
The recent rout in oil prices, which was exacerbated at OPEC’s decision to keep output at its November meeting, is not expected to be reversed, as OPEC and non-OPEC producers are not showing signs of an output cut anytime soon.
February Brent crude was last down 0.54 cents or 0.90% to $60.85 a barrel, after topping $62 a barrel on Monday morning.
WTI crude oil futures fell 0.85 cents to $56.28 a barrel. As of 14:43 GMT
Price volatility is expected to be lower for remainder of the year, as traders usually start to wind down their yearly positions.