[SINGAPORE] Brent crude briefly fell to fresh multi-year lows below US$28 a barrel in Asia on Monday on fears of a worsening supply glut after Western sanctions on Iran were lifted, allowing the country to resume oil exports.
Brent for March delivery tumbled to as low as US$27.67, or by 4.4 per cent from Friday's close, before rebounding to trade at above US$28. The last time Brent closed below US$28 was in November 2003.
At around 0145 GMT, Brent was trading 43 cents, or 1.49 per cent, lower at 28.51. US benchmark West Texas Intermediate for delivery in February was down 35 cents, or 1.19 per cent, at US$29.07 a barrel.
"The drop was due to the Western sanctions on Iran being lifted. This means we will be seeing a bigger oil glut with Iranian crude exports coming back to the market," said Phillip Futures analyst Daniel Ang.
The United States and the European Union lifted the sanctions on Sunday after the UN's atomic watchdog confirmed that Iran had complied with its obligations under a landmark deal last year to curb Tehran's nuclear programme.
For more stories on the oil rout, visit btd.sg/oilrout14