From Reuters:

A pump jack operates at a well site leased by Devon Energy Production Company near Guthrie, Oklahoma September 15, 2015. Reuters/Nick Oxford

Crude futures lost ground in early Asian trading on Monday, with U.S. oil plunging more than 2 percent, pressured by a global supply surplus despite a cut in the number of U.S. rigs for an eleventh week out of 12.

U.S. crude’s West Texas Intermediate (WTI) January contract CLc1 had dropped 91 cents, or 2.17 percent, to $40.99 a barrel by 0215 GMT. That was near levels seen on Friday before the U.S. crude December contract expired.

Benchmark front-month Brent futures for January LCOc1 fell 60 cents, or 1.34 percent, to $44.06 a barrel, after ending up 48 cents at $44.66 a barrel on Friday.

“The burden of carrying high U.S. crude oil inventories is large,” Kang Yoo-jin, commodities analyst at NH Investment and Securities in Seoul, said in a note on Monday.

“The markets would likely rebound only if they saw a fall in U.S. crude inventories, while declining U.S. crude output and seasonal demand provide some support to oil at low prices.”

Venezuela’s oil minister said on Sunday that OPEC cannot allow an oil price war and must take action to stabilize the crude market soon. When asked how low oil prices could go in 2016 if OPEC doesn’t change its policy, he said: “Mid-20s.”

BMI Research, part of the Fitch ratings agency, said: “What is underway now is a structural market…

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