The price of Brent crude oil prices has dropped below $60 a barrel due to concerns about oversupply in North America.
Reuters reported that Brent crude traded 28 cents lower at $59.94 and benchmark US WTI crude April futures dropped 3 cents to $50.31 a barrel.
Brent reached a low of $45.19 a barrel on 13 January 2015 after trading near $115 in June last year.
However, the market has picked up in the recent days as Brent futures reached $63 a barrel last week due to decline in the US rig count.
Morgan Stanley warned that US crude stocks will build through May.
See Also:
The bank was quoted by the news agency as saying: "Despite optimism about the large drop in the US rig count in recent weeks, the pace of decline has been decelerating.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalData"A further slowing (in rig count) would only reinforce concerns that a large production decline could take longer."
The decline in oil prices led to the slow down of drilling operations in the US. However, Goldman Sachs said the pace of the US rig count decline was now slowing.
Goldman expects US oil production growth to reach 440,000 barrels per day by the fourth quarter.
According to analysts, a cold situation in the US may also prevent crude prices from increasing further. Most of the country’s East Coast refineries have been hit by cold weather.