The price of Brent crude oil dropped below $60 a barrel today after an increase in US crude inventories.
Reuters reported that benchmark Brent crude futures for April were down $1.67 at $58.86 a barrel and US crude for March delivery declined to $50.09 a barrel.
Data from the American Petroleum Institute (API) has revealed that US crude stocks increased by 14.3 million barrels last week, compared with analysts’ expectations for an increase of 3.2 million barrels.
If the build is confirmed by US Energy Information Administration (EIA) data, which is due to be unveiled later today, it will be the largest weekly growth since EIA data came into existence in 1982.
Looking ahead to the EIA data, Commerzbank oil analyst Carsten Fritsch said: "A big build of seven to nine million barrels would be enough to push prices lower.
"But tomorrow we could see a recovery in expectation of another sharp drop in the rig count."
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Meanwhile, consultancy firm PIRA said production from Saudi Arabia may be increasing to nearly ten million barrels per day.
The country is planning to protect its market share instead of reducing output to increase prices.