LONDON: Brent crude slipped towards $69 a barrel on Friday, on track to finish the week below $70 a barrel for the first time since 2010, as cuts to official selling prices from Saudi Arabia helped hold oil near five-year lows.
Prices have tumbled by roughly 40 percent since June, hitting their lowest in five years earlier this week, as the market grapples with oversupply as a result of the US shale boom and the recent decision by the Organization of Petroleum Exporting Countries not to cut production.
Some analysts said the Saudi cuts to monthly prices for crude it sells to the United States and Asia show it is stepping up its battle for market share. "It's been weighing on the market, showing that OPEC is not ready to end its price war," said Commerzbank analyst Eugen Weinberg.
"The lower the better seems to be the new paradigm for OPEC." The January Brent crude contract fell by 64 cents to $69 a barrel by 1146 GMT, on track for the ninth weekly loss in 10 weeks.
US crude was down 54 cents at $66.27. Investors are looking ahead to the US government's non-farm payrolls report for November, due at 1330 GMT.
Expectations are that the US economy created 230,000 jobs last month.
US strength contrasts with the eurozone, where Germany's Bundesbank this week halved its 2015 growth forecasts for Europe's largest economy to 1 percent.
At the same time, oversupply could rise next year when Iraq starts to export more oil as a result of an agreement between Baghdad and the Kurdish regional government.
Libya is also set to restart its largest oilfield, El Sharara, once a pipeline blockage is cleared.
The combined pressure is preventing Brent from rebounding from a near 13-percent plunge last week.
The fall may put global oil and gas exploration projects worth more than $150 billion on hold next year, potentially curbing supply by the end of the decade.
Fatih Birol, chief economist with the International Energy Agency, said on Friday he sees oil prices rising to near $100 a barrel in the coming years.
Analysts also expect oil prices to rebound in the next two years, averaging $82.50 a barrel in 2015, a Reuters poll showed. But some said OPEC's recent decision not to cut production was still filtering through the market.
"If you look at prices over the last few days, oil is on a downward trajectory, it's almost a straight line," said Gareth Lewis-Davies, senior energy strategist at BNP Paribas, adding that the market is "still trying to get to grips with OPEC's decision not to cut oil production."
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