The price of Brent crude suffered a decline on Monday, slipping from a record high of $53.30 to $51.24.
The market had seen the price of the commodity improve after OPEC and its allies reached an agreement to cut production levels.
OPEC and OPEC + held a meeting on Monday, however, there was no resolution on output levels for February. The meeting is expected to continue on Tuesday.
The price slumped despite expectations that OPEC+ would refrain from increasing output next month and optimism over a vaccine-driven economic recovery, according to Reuters.
There are indications that an increase in output from February would not fall through, as members of OPEC+ were against increasing output level, at their meeting on Sunday.
Members of OPEC+ raised their output level by 500,000 barrels daily in January, however, they question the rationale for a further increase from February amidst the rise in the COVID-19 pandemic.
The group plans to gradually raise output until it reaches the 2 million barrels daily production level. The decision was reached in December 2020, with the takeoff month being January 2021.
OPEC+ producers reduced output to eliminate the glut on the market thereby helping to improve the price of the commodity, in wake of the COVID-19 pandemic.
On Sunday, OPEC Secretary-General, Mohammad Barkindo, warned OPEC+ experts of downside risks facing the oil market.
On Monday, Saudi Energy Minister, Prince Abdulaziz bin Salman, said OPEC+ should be vigilant and cautious despite a generally optimistic market environment as the demand for fuels remained fragile and the new variant of coronavirus was unpredictable.
“In many parts of the world, where infection rates have increased worryingly, a new wave of lockdowns and restrictions are being put in place, which will inevitably impact the rate of economic recovery in those countries,” he said.
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