KEY POINTS:
Oil dropped nearly 3.5 per cent to below US$58 on Monday as Opec members including Saudi Arabia signaled the group would probably keep output stable when it meets in March and as US winter supply concerns eased.
US crude settled down US$2.08 to US$57.81 a barrel, after dipping as low as $57.38 in earlier activity. London Brent crude slid $2.41 to $56.60.
The losses came after Ali Al-Naimi, oil minister for Opec powerhouse Saudi Arabia, said the cartel would probably keep production levels steady at its next meeting on March 15.
"If you are asking me are we (Opec) going to take additional cuts or increase supply, I do not know," Naimi said in an interview with the Wall Street Journal.
"But, most probably, if the trend is like what it is like today, with the market getting in much, much better health and balance, there may not be any reason to change," he said.
The remarks were consistent with comments Naimi made on Jan. 16, when oil was nearer $51, and Qatari Oil Minister Abdullah al-Attiyah backed his comments.
"I agree 100 per cent," he told reporters. "I am confident Opec will not change (production) ... Below $50 is not good for producers and higher than $60 is not good for consumers."
The group has already cut 1.7 million barrels per day -- 6 per cent of Opec supplies -- in two stages on Nov. 1 and Feb. 1, after oil prices tumbled from record highs over $78 a barrel in July.
Opec ministers from Kuwait, Algeria and Nigeria have lined up in recent days to say that, barring unforeseen developments, there was no need for further Opec supply reductions.
- REUTERS
