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Brent oil lowers $2.22 at $66.85/barrel, lowest since Oct 2009

Brent oil lowers $2.22 at $66.85/barrel, lowest since Oct 2009

LONDON: Brent crude oil plunged more than $2 a barrel on Monday to a new 5-year low.

Brent crude for January was down $2.22 at $66.85 a barrel by 1210 GMT, having fallen $2.30 to $66.77 – its lowest since October 2009.

In a report dated Dec. 5, U.S. investment bank Morgan Stanley said oil prices could fall as low as $43 a barrel next year. The bank cut its average 2015 Brent base-case outlook by $28 to $70 per barrel, and by $14 to $88 a barrel for 2016.

“Without OPEC intervention, markets risk becoming unbalanced, with peak oversupply likely in the second quarter of 2015,” Morgan Stanley analyst Adam Longson said.

U.S. crude was down $1.60 at $64.24 a barrel, after hitting a session low of $64.14. The U.S. contract, also known as West Texas Intermediate, touched $63.72 last week, its lowest since July 2009.

At a meeting last month, top oil exporter Saudi Arabia resisted calls from poorer members of the Organization of the Petroleum Exporting Countries to reduce production, driving a further slide in prices, which have lost more than 40 percent since June.

The U.S. shale industry has yet to be hit by the slump in crude prices, Baker Hughes said in a report on Friday, reporting that three new U.S. oil-drilling rigs had been added in the last week.