Oil prices fell sharply on Monday as concerns about supply disruptions eased and Libyan ports reopened while traders eyed potential supply increases by Russia and other oil producers.
Benchmark Brent crude dropped $2.24 to a low of $73.09 by 1238 GMT. U.S. light crude was down $1.60 at $69.41.
“The energy complex is a sea of red as concerns about supply outages subside,” said Stephen Brennock, analyst at London brokerage PVM Oil Associates.
Supply outages in Libya, a labour dispute in Norway and unrest in Iraq all helped push oil prices higher late last week, although prices still fell for a second straight week.
Russia and other oil producers could raise output by 1 million barrels per day (bpd) or more if shortages hit the market, Russian Energy Minister Alexander Novak told reporters on Friday.
“If we need more than 1 million bpd, I don’t rule out that we can quickly discuss it and make a quick decision,” he said.
Commerzbank commodities analyst Carsten Fritsch said the outlook for supply was unclear with news of disruptions from several oil producers, but Saudi Arabia and Russia had reminded the market of their determination to pump more oil if needed.
“Novak’s comments indicate that Russia and Saudi Arabia could raise production fast if needed,” Fritsch said.
Production at Libya’s giant Sharara oilfield was expected to fall by at least 160,000 barrels per day (bpd) after two staff were abducted in an attack by an unknown group, the National Oil Corporation said on Saturday.