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Brent crude dropped to the lowest level since 2004 amid speculation suppliers from the Middle East to the U.S. will exacerbate a record glut as they continue fighting for market share, Bloomberg reported.
Oil has fallen below levels last seen during the 2008 global financial crisis on signs the market's oversupply will worsen, according to Bloomberg.
The Organization of Petroleum Exporting Countries (OPEC) effectively abandoned output limits at a December 4 meeting, while the U.S. on Friday passed legislation that lifted a 40-year ban on crude oil exports.
Brent for February settlement slid as much as 71 cents to $36.17 a barrel on the London-based ICE Futures Europe exchange, the lowest level since July 13, 2004, according to the report.
West Texas Intermediate for January delivery was 28 cents lower at $34.45 a barrel on the New York Mercantile Exchange.
The number of drill rigs targeting oil rose to 541, Baker Hughes said on its website Friday. Beyond the unexpected gain in the U.S. oil rig count, the strength in the U.S. dollar following last week's interest rate hike - which makes oil more expensive for countries using different currencies - also weighed on prices.
More oil becoming available soon will add to the glut, with Iran hoping to boost its sales in early 2016 once sanctions against it are lifted.
Meanwhile, the demand for oil remains weak in the world due to the slowdown in the Chinese economy and the reduction in demand from developing countries.