Prices fall below $60 in US crude oil trading

US crude oil prices have continued their downwards trajectory, falling below the $60 level for the first time in five-and-a-half years.

Oil futures in the US closed at $59.95 a barrel after falling by 1.6 per cent on the New York Mercantile Exchange - the lowest closing price since July 2009. 

A global supply glut, caused partly by the US shale oil boom, has combined with lower levels of demand to push prices lower. 

Ian Taylor, chief executive of Vitol, suggested the cheapest oil since 2009 could linger, the Financial Times reports.

"Over the last few months it’s become increasingly clear that demand predictions have been and continue to be consistently on the high side," he told the Platts Global Energy Outlook Forum in New York.

His comments have been echoed by others in the oil market. Alex Beard, head of oil at the commodities trading house Glencore, said at an investor day on Wednesday that low prices and capital discipline are set to persist.

There were falls of $2 on Wednesday after OPEC revealed demand for its crude in 2015 would be the lowest in a decade and below current levels.

Saudi Arabia’s oil minister indicated that his country does not intend to change its position and reduce production. "Why should I cut production?" Ali Al-Naimi said at a conference in Lima. "This is a market and I’m selling in a market. Why should I cut?"

According to official forecasts from bodies including Opec and the US Energy Department, world oil consumption will rise by one million barrels per day (bpd) next year, Mr Taylor said.

However, he predicted demand would only grow by 600,000 bpd this year, due to improvements in energy efficiency and the weakening of large economies in Asia and Europe.

Brent, the international crude marker, also declined, falling 56 cents to $63.68 a barrel - its lowest level since 2009.