The price of Brent crude fell to its lowest level in more than 20 months amid concerns about the US economy, before later edging back up.
Brent crude fell as low as $58.38 a barrel before rising back up to $61.10 a barrel by late morning in London.
US sweet crude oil traded at $64.86 per barrel, having dipped as low as $62.25.
Oil prices have slumped since hitting a record of $147 a barrel in July, as consumers have cut their spending and the chances of a global recession grow.
Members of oil cartel Opec have decided to cut output to boost prices.
"The overriding concern is the economy in the US," said Victor Shum, energy analyst at consultancy Purvin & Gertz.
Credit Suisse has cut its forecast for China's energy demand, predicting that it will remain unchanged in 2009.
Recent figures showed China's economic growth rate fell for the third quarter in a row, prompting fears of a wider downturn.
Growth slowed to an annual pace of 9% in the three months to September - down from 10.1% over the previous quarter.
There had been hopes that growth in developing nations such as China and India would help offset the slump in demand in US.
On Monday, poor US economic data underlined the degree of the slowdown in the world's largest economy.
The Institute for Supply Management said its manufacturing index dropped to 38.9 in October - its worst reading for 26 years. Any reading under 50 indicates contraction.
No comments:
Post a Comment