Investing.com - Oil prices slumped in early Asia on Monday as the supply outlook remains robust despite a sustained drop in prices of more than 50% in the past six months.
On the New York Mercantile Exchange, crude oil for delivery in February eased 0.78% at $48.75 a barrel.
Last week, oil prices rallied sharply on Friday, as bullish comments made by the International Energy Agency helped ease concerns over a glut in global supplies.
For the week, New York-traded oil futures inched up 33 cents, or 0.67%, the first weekly gain in eight weeks.
Elsewhere, on the ICE Futures Exchange in London, Brent for March delivery jumped $1.90, or 3.94%, to settle at $50.17 a barrel on Friday.
The International Energy Agency cut its forecast for the increase in non-OPEC oil supply this year by 350,000 barrels a day, amid indications lower prices had begun to curb output in some areas, including North America.
“A price recovery, barring any major disruption, may not be imminent, but signs are mounting that the tide will turn,” the IEA said in its monthly oil market report.
Industry research group Baker Hughes said Friday that the number of rigs drilling for oil in the U.S. fell by 55 last week to 1,366, the lowest since October 2013.
The number of oil rigs has declined in 11 of the last 14 weeks since hitting an all-time high of 1,609 in mid-October.
Concerns over weakening global demand combined with indications that the Organization of the Petroleum Exporting Countries will not cut output to support oil markets have weighed on prices in recent months.
At the same time, increasing supplies of crude oil from North American shale formations have helped create a glut in world markets.
Elsewhere, gold rallied to the highest level in more than four months on Friday, as demand for safe haven assets was boosted amid turmoil in the currency market, following the Swiss National Bank's surprise policy decision to scrap its peg against the euro.
Traders are also looking ahead to a raft of Chinese economic data later this week, including reports on fourth quarter gross domestic product, as well as data on industrial production and retail sales.