SINGAPORE: Brent crude fell below US$126 on Monday after the African Union said Muammar Gaddafi has accepted a roadmap to end the civil war in Libya including an immediate ceasefire in the North African producer.
South African President Jacob Zuma, who led a delegation of African leaders at talks in Tripoli, met Gaddafi for several hours. The issue of Gaddafi's stepping down had also been discussed, the African Union said.
Brent oil fell 88 cents to US$125.77 a barrel by 0625 GMT after hitting an intraday low of US$125.54.
The May contract surged on Friday to settle above US$126 a barrel, the highest level in 32 months, as commodities rallied due to a weaker dollar and as continued fighting in Libya raised fears of longer-term supply cuts.
U.S. crude for May delivery fell 36 cents to US$112.43 a barrel.
Peace talks in Libya, where the unrest has been supporting oil prices, are "definitely going to weigh on the oil market," ANZ analyst Serene Lim said.
Top oil exporter Saudi Arabia reiterated its position during weekend that its "huge" spare output capacity allows it to meet a rise in demand or a drop in supplies.
The country would have "no problems" producing at its claimed 12.5 million barrels per day (bpd) capacity if the market needed the oil, a senior Gulf source told Reuters on Sunday.- Reuters
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South African President Jacob Zuma, who led a delegation of African leaders at talks in Tripoli, met Gaddafi for several hours. The issue of Gaddafi's stepping down had also been discussed, the African Union said.
Brent oil fell 88 cents to US$125.77 a barrel by 0625 GMT after hitting an intraday low of US$125.54.
The May contract surged on Friday to settle above US$126 a barrel, the highest level in 32 months, as commodities rallied due to a weaker dollar and as continued fighting in Libya raised fears of longer-term supply cuts.
U.S. crude for May delivery fell 36 cents to US$112.43 a barrel.
Peace talks in Libya, where the unrest has been supporting oil prices, are "definitely going to weigh on the oil market," ANZ analyst Serene Lim said.
Top oil exporter Saudi Arabia reiterated its position during weekend that its "huge" spare output capacity allows it to meet a rise in demand or a drop in supplies.
The country would have "no problems" producing at its claimed 12.5 million barrels per day (bpd) capacity if the market needed the oil, a senior Gulf source told Reuters on Sunday.- Reuters
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