LONDON (Bloomberg) -- Crude oil fell to its lowest this year in New York, declining in tandem with equities, on speculation global stockpiles remain more than adequate.

The Organization of Petroleum Exporting Countries won’t need to raise oil production this year as its output of natural gas liquids increases, the International Energy Agency’s deputy executive director said on Monday. Oil also slipped as Japan Airlines Corp., Asia’s largest carrier, filed for bankruptcy, raising concern its fuel hedges may be liquidated.
“I still see prices at current levels as overvalued by about $2 a barrel,” said Andy Sommer, an oil analyst at Eleltrizitaets-Gesellschaft in Dietikon, Switzerland. “Increasing demand in China and emerging markets is still not strong enough to offset declines in the other countries. OPEC is producing too much to balance the market.”
Crude oil for February delivery dropped as much as 93 cents, or 1.2 percent, to $77.07 a barrel in electronic trading on the New York Mercantile Exchange. That’s the lowest since Dec. 24. It was at $77.49 as of 10:31 a.m. London time.
Futures dropped 5.7 percent last week, the first weekly decline in five, after U.S. fuel supplies rose.
February futures, which settled at $78 a barrel on Jan. 15, expire tomorrow. The more widely traded March contract fell as much as 97 cents, or 1.2 percent, to $77.40 a barrel.
European stock prices declined before a report that may show investor confidence in Germany, the region’s biggest economy, dropped for a fourth month in January amid signs the recovery is slowing. Asian shares also fell, while U.S. index futures were little changed.
Japan Airlines Corp. filed for bankruptcy under a government-backed plan to help reduce debts, cut unprofitable operations and access new investment.
Brent crude oil for March settlement fell as much as $1.28, or 1.7 percent, to $75.82 a barrel on the London-based ICE Futures Europe exchange. It traded for $76.26 as of 10:33 a.m. local time.