Oil investors were showing their nerves today, with the price of both Brent crude and WTI crude edging closer to $28, as sanctions against Iran were lifted, potentially adding millions of barrels of oil to an already oversupplied market.
Brent, the global benchmark, dropped to $28.17 in early trading, while the US-focused WTI fell to $28.71.
The two slid more or less consistently throughout last week, as the reality of the lifting of sanctions on Iran began to bite.
The country has the world's fourth-largest crude oil reserves, and claims it can boost production by almost half a million barrels per day "almost immediately".
The news has caused hedge funds to pile into short positions, Accendo Markets' head of research Michael van Dulken said.
Analysts at Barclays suggested a glut in supply might not be the only problem to hit the market this week.
"New-year woes are now being compounded by preliminary data suggesting demand is weaking sharply as well," they said.