Oil prices retreat as OPEC refuses to cut output

Oil prices dropped to a five-year low under fresh selling pressure on Monday as the United Arab Emirates said the Organization of Petroleum Exporting Countries ( OPEC) will not reduce production in response to the slump.

Light, sweet crude for January delivery moved down 1.9 U.S. dollars to settle at 55.91 dollars a barrel on the New York Mercantile Exchange,while Brent crude for January delivery lost 79 cents to close at 61.06 dollars a barrel.

Concerns over a global glut of oil continued to weigh on the market. The crude price has fallen more than 45 percent since June as producers from the United States have ramped up output amid lukewarm energy demand.

U.S. crude production reached 9.12 million barrels per day (b/d) for the week ended Dec. 5, according to the Energy Information Administration (EIA). The figure is just 1 million b/d short of Saudi Arabia's output.

Meanwhile, Suhail Al-Mazrouei,the energy minister of United Arab Emirates, restated on Sunday that OPEC will refrain from cutting output even if prices fall as low as 40 dollars.

OPEC, which pumps a third of the world's crude, maintained its collective production ceiling of 30 million barrels a day on a meeting in Vienna on Nov. 27. Analysts regarded the decision very bearish to crude prices. As the organization keeps production steady, crude prices could fall further.

Meanwhile, a stronger U.S. dollar and uncertainties about global economic growth have also contributed to the oil prices slump.

The EIA cut its crude price forecasts by 15 dollars last week in response to the OPEC decision and rising U.S. output, and predicated that U.S and Brent crude will average 62.75 dollars and 68.08 dollars respectively in 2015.