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By Bloomberg

Oil slid in New York for a fifth day as Goldman Sachs Group Inc. said a continuing surplus would send prices back down to $45 a barrel by October.

Futures slid as much as 1.3 percent in New York, extending a 2.4 percent decline in the past four sessions. Crude is poised to revisit earlier lows as a surplus of supplies and producers’ easy access to cash weigh on prices later this year, according to Goldman Sachs. Saudi Arabia shipped more oil in March than in any month since November 2005 as the world’s biggest exporter battled for market share.

Oil’s rebound from a six-year low in March has faltered near $60 a barrel amid speculation that rising prices will encourage production in U.S. shale formations. The Organization of Petroleum Exporting Countries, led by Saudi Arabia, has resisted calls to reduce output, exacerbating the oversupply. The group next meets on June 5 in Vienna.

“Crude looks like it has topped out,” Michael Hewson, a London-based senior analyst at CMC Markets Plc, said by phone. “Supply is still outstripping demand, and there’s no sign the Saudis are turning down the taps.”

West Texas Intermediate for July delivery was 56 cents lower at $59.68 a barrel in electronic trading on the New York Mercantile Exchange at 9:55 a.m. London time. June futures, which expire Tuesday, fell 48 cents to $58.95. The volume of all futures traded was about 23 percent below the 100-day average for the time of day. Front-month prices are up about 11 percent this year.

U.S. Supplies

Brent for July settlement slid 70 cents to $65.57 a barrel on the London-based ICE Futures Europe exchange. It decreased 0.8 percent to $66.27 on Monday. The European benchmark crude traded at a premium of $5.85 to WTI for the same month.

U.S. companies still have access to cheap external capital and there is a rising backlog of drilled but uncompleted wells that can be brought into production quickly, Goldman analysts including Jeffrey Currie said in an e-mailed report dated Monday. U.S. production will keep growing next year, the bank said.

Drillers in the U.S., the world’s biggest oil user, reduced the number of active rigs by eight to 660 through May 15, the smallest cut since December, according to data from Baker Hughes Inc.

U.S. crude inventories probably shrank by 2 million barrels through May 15, according to a Bloomberg survey before an Energy Information Administration report Wednesday. They dropped to 484.8 million barrels in the week ended May 8, EIA data showed last week. Supplies still remain near the highest level in 85 years, based on monthly records dating back to 1920, and are more than 100 million barrels above the five-year average for this time of the year.

Saudi Exports

Saudi Arabia, the biggest producer in OPEC, shipped 7.9 million barrels a day of crude in March, up 548,000 barrels a day from February, according to figures published Monday on the website of the Joint Organisations Data Initiative. Iraq exported 2.98 million barrels a day in March, the most since at least January 2007 when it began submitting data to JODI.

OPEC, which supplies about 40 percent of the world’s oil, agreed at a November meeting to maintain its collective production quota at 30 million barrels a day. That target is right, Iran’s Deputy Oil Minister Roknoddin Javadi said in Kuala Lumpur on Monday.

While OPEC will look at supply and demand before making a decision on output in June, the current situation differs from November because prices are improving, Nawal al-Fezaia, Kuwait’s governor to the 12-member group, told reporters in Kuwait City Monday.