NEW YORK (CNNfn) - Crude oil future prices, already hovering around 12-year lows, slipped further on the commodities board Monday as the market discounted Venezuela's latest vows to cut its oil production.
Venezuela, the world's second-biggest exporter of oil, has been widely seen as violating its production quota for months under the Organization of Petroleum Exporting Countries (OPEC) agreement. In recent weeks, the situation is believed to have gotten worse.
The 11-member oil group is struggling to get low oil prices back in line by tackling a persistent oversupply of oil in the market.
Last week, however, OPEC ministers in Vienna failed to agree on a plan to reduce the global glut, opting instead to postpone its decision on production policy and output cuts until next March.
That sent crude future prices tumbling to levels not seen since 1986.
Shortly after winning Sunday's presidential election in Venezuela, Hugo Chavez said his government will comply with oil production cuts.
"Under the new government, Venezuela will comply rigorously with the agreements reached this year on oil production cuts," he told a news conference after early results confirmed his victory in Sunday's poll.
"Up to now, Venezuela has not completely complied and, of course, this has to be reciprocal. It should be complied with by all countries that signed the agreements," he added.
But the market has heard that before.
Venezuela agreed in June to slash 525,000 barrels per day (bpd) from its 3.4 million bpd production as part of worldwide attempts to rescue slumping prices, but has admitted to being about 120,000 bpd short of the target.
This time around, investors are waiting to see production cuts implemented before reacting.
Crude oil futures prices in London fell below $10 Monday, the lowest since the Brent cash market dipped below $9 in 1986.
Brent crude for January delivery on London's International Petroleum Exchange dipped to $9.94 a barrel.
Oil on average this year, at $13.56 for Brent, is lower than at any time since 1976.
Markets are smothered by an enormous stock overhang created by a demand collapse in Asia, an unusually warm 1997-98 winter, rising Iraqi exports and a badly-timed lifting of OPEC's output ceiling a year ago.
New OPEC President Youssef Yousfi said this month he will step up consultation with members of the crude oil exporting group to try to stem the slide in oil prices.
OPEC Secretary General Rilwanu Lukman said Saturday the group could hold an extraordinary meeting to deal with the crisis before its next scheduled session in March. The cartel met in Vienna last week but took no action to rescue prices.
-- from staff and wire reports