WTI fell to the lowest level since July 2009

West Texas Intermediate crude fell to the lowest level since July 2009 as Saudi Arabia questioned the need to cut output, bolstering speculation that OPEC's biggest producer will defend market share.

Futures fell as much as 1.4 percent in New York while Brent slipped 0.8 percent. The market will correct itself, according to Saudi Arabian Oil Minister Ali Al-Naimi. Global demand for crude from the Organization of Petroleum Exporting Countries will drop next year by about 300,000 barrels a day to 28.9 million, the least since 2003, the group predicted yesterday.

Oil's collapse into a bear market has been exacerbated as OPEC's three largest members offered the deepest discounts on exports to Asia in at least six years. The group decided against reducing its output quota at a meeting last month, letting prices drop to a level that may slow U.S. production that's surged to the highest level in more than three decades.

"The market is in free fall," Stephen Schork, president of Schork Group Inc., a consulting group in Villanova, Pennsylvania, said by phone. "Prices will continue to fall until the Saudis signal that they are prepared to take action or we see the global economy pick up."

WTI for January delivery fell 27 cents, or 0.4 percent, to $60.67 a barrel at 10:02 a.m. on the New York Mercantile Exchange. Futures touched $60.09, the lowest since July 15, 2009. Total volume was 34 percent above the 100-day average for the time of day. The U.S. benchmark is down 38 percent this year.

Brent for January settlement slipped 11 cents to $64.13 a barrel on the London-based ICE Futures Europe exchange. Volume was 6.4 percent higher than the 100-day average. The North Sea crude traded at a $3.46 premium to WTI. Prices are down 42 percent in 2014.