UPDATE: Benchmark Brent crude held below $60-barrel as Russia and OPEC pump up oil glut

17 December 2004 12-midday GMT

Global oil benchmark Brent crude continued to trade below $60-barrel today – near five year lows – as major oil producers signalled that they would maintain output despite a supply glut and faltering demand in Russia and Europe.

Core Gulf OPEC members have said they are prepared to wait as long as a year for the market to stabilise, undercutting hopes they will step in to stem crude price losses.

Oil prices have almost halved over the last six months as increasing volumes of light, high-quality crude from North American shale have overwhelmed demand.

“Every day now you have some Gulf OPEC member actively trying to talk the market down,” said Olivier Jakob, oil analyst at Petromatrix. “OPEC is trying to choke U.S. oil producers.”

Brent for February was down 55 cents at $59.46 a barrel by 11.15am. The January Brent contract, which expired in the prior session, hit a low of $58.50 on Tuesday – the weakest since May 2009.

U.S. crude dropped 85 cents to $55.08 a barrel, after touching the lowest since May 2009 at $53.60 on Tuesday.

Russian Energy Minister Alexander Novak has said Moscow will not cut output in 2015, even if pressure on its finances rises with the economy showing signs of severe stress.

Meanwhile, Husky Energy – Canada’s No. 3 integrated oil company – said it expects capital spending to drop by a third in 2015 as oil prices continue to slide.

In the UK, falling oil prices are likely to cut tax revenues and jobs and investment in the North Sea next year.

* The Wood Group has today confirmed another 10% cut in rates paid to its N. Sea services contractors – in addition to an initial 10% cut it announced in May 2014.