In this file photo taken with a long exposure, a pumping unit sucks oil from the ground near Greensburg, Kansas. US oil price fell to its lowest level in six years amid a global supply glut. AP
NEW YORK, United States – US oil prices sank to a six-year low Monday after a report by the oil cartel OPEC pointed to a continued petroleum supply glut.
The US benchmark contract West Texas Intermediate for April delivery lost 96 cents to finish at $43.88 a barrel on the New York Mercantile Exchange after earlier sliding below $43 a barrel.
European benchmark Brent oil for April delivery dropped $1.23 to $53.44 a barrel in London.
In its monthly oil market report, the Organization of the Petroleum Exporting Countries questioned the validity of February’s rally in oil prices amid an oversupply of almost one million barrels a day on the market.
‘Questionable’ oil price hikes
The increase came “despite the fact that global supply continued to exceed demand,” OPEC said.
The report followed a similar analysis last week by the International Energy Agency, which said US crude inventories were nearing storage capacity levels due to the oil production boom and heavy maintenance at refineries.
Oil prices have dropped about 60 percent since June on mounting US supplies, weak global economic growth and the decision of OPEC to keep output high despite falling prices.
Leading US energy producers have curtailed some investment, resulting in lower weekly rig counts.
Despite the reduced drilling, Goldman Sachs estimated Monday that US oil output would still grow by 230,000 barrels a day in the fourth quarter of 2015 compared with a year ago.
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