Brent Crude Falls Below $28 per Barrel

Bloomberg reported that Brent crude fell below $28 per barrel on Monday, extending its fall after sanction on Iran were lifted. Market participants are concerned that the current oil glut will intensify once supply from Iran hits the market again.
As quoted in the market news:

Futures lost as much as 4.4 percent in London, slipping to the lowest since November 2003. Iran is beginning efforts to boost output and exports by 500,000 barrels a day now that restrictions have been lifted, Amir Hossein Zamaninia, deputy oil minister for commerce and international affairs, said Sunday. Saudi Arabia’s Oil Minister Ali al-Naimi said prices will rise, and that market forces and cooperation among producing nations will lead to stability.

“There is ongoing negative pressure on oil prices from oversupply,” Ric Spooner, a chief analyst at CMC Markets in Sydney, said by phone. “Iran is not new, but we’ve arrived now at the point where sanctions have been removed and it’s going to be a key focus for the markets over coming weeks. The question is how much supply can come online in the short-term.”

Click here to read the full Bloomberg report.