Brent Crude Drops Below $40 for First Time in Almost Seven Years

Brent crude fell below $40 a barrel for the first time in almost seven years after OPEC effectively abandoned any limits on crude output, prompting speculation that a record global glut will continue.

Brent crude fell 2.1 percent to $39.88 a barrel at 1:45 p.m. London time Tuesday, the lowest since Feb. 20, 2009.

Oil has slumped about 40 percent since Saudi Arabia led the Organization of Petroleum Exporting Countries’ decision a year ago to maintain output and defend market share by pressuring higher-cost producers. At a meeting on Dec. 4 in Vienna, the group set aside its production target of 30 million barrels and endorsed current output of about 31.5 million. The lack of any limit on OPEC supplies could lift the lid on millions of barrels of additional crude from countries including Iran next year.

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