Oil plunges below $30 per barrel, first time since Dec 2003

Oil plunged below $30 per barrel on abundant crude supplies, as OPEC member Nigeria called for an emergency meeting to address collapsing prices that have ravaged revenues.

London: Oil dived Tuesday close to $30 on abundant crude supplies, as OPEC member Nigeria called for an emergency meeting to address collapsing prices that have ravaged revenues.

In late afternoon deals, New York`s benchmark West Texas Intermediate (WTI) for February delivery tanked to $30.10 a barrel, which was the lowest level since December 2, 2003.

Europe`s Brent North Sea crude for February had earlier dived to $30.43, a point last seen on April 6, 2004.

"Oil prices are looking to test $30 a barrel again, despite news of some member states calling for an emergency OPEC meeting before the scheduled one in June," said GKFX analyst James Hughes.

Nigerian petroleum resources minister Emmanuel Ibe Kachikwu declared that he expects an extraordinary meeting of the oil cartel in "early March" to discuss nosediving crude prices.

"We did say that if it (the price) hits the 35 (dollar per barrel), we will begin to look (at)... an extraordinary meeting," said Kachikwu.

The prices have hit levels that necessitate a meeting, he told an energy forum in Abu Dhabi, but added that he had not yet confirmed with fellow OPEC ministers if they would be willing to attend.

In later deals, Brent oil was down 97 cents at $30.58, while WTI stood at $30.26, down $1.15 from Monday`s close.

Saudi-led Gulf exporters within the Organization of Petroleum Exporting Countries (OPEC) have so far refused to cut production to curb sliding prices, seeking to protect their market share despite a heavy blow to their revenues.

Kachikwu said member states differ on the issue of intervention.

"One group feels there is a need to intervene. The other group feels even if we did, we are only 30 to 35 percent of the producers really", as 65 percent of supply comes from non-OPEC countries, he said at the Gulf Intelligence UAE Energy Forum.

Nigeria, Africa`s largest economy and foremost oil producer, has been ravaged by collapsing oil prices in recent years because crude accounts for 90 percent of the nation`s export earnings and 70 percent of overall government revenue.

"The reported breakeven price for Nigeria is around $87 a barrel and with (the) price looking so much weaker it`s no surprise if they are one of the countries asking for a meeting," added Hughes.

OPEC refused to slash output at its scheduled production meetings in June and December last year, despite a collapse in prices since July 2014, when the market stood above $100 per barrel.The Saudi-backed policy, and supported really by only OPEC`s Gulf members, is aimed at pushing oil prices lower to squeeze US shale producers out of the market. However, it has slammed smaller producing nations like Nigeria and Venezuela.

"OPEC has taken a big gamble that has not really worked so far," said analyst Fawad Razaqzada at Gain Capital.

"Essentially, the smaller OPEC members, who are struggling really badly, are unlikely to be able to persuade the Saudis to make a U-turn on its policy of maintaining market share."

The market`s dramatic collapse has continued in 2016, as a row between cartel kingpin Saudi Arabia and fellow cartel member Iran dimmed prospects for production cutbacks.

Crude futures plummeted 10 percent last week, also on fears about the global supply glut and demand weakness in China, the world`s biggest energy user.

The rise in the greenback, which makes dollar-priced oil more expensive for holders of weaker currencies, has dented prices as well.