London: Oil pared losses on Thursday after an early fall below $46 a barrel to its lowest in nearly four years, in response to a bleak outlook for the world economy and oil demand.
Oil prices have dropped at least $100 a barrel from an all-time high of $147.27 hit in July.
US light crude for January delivery was down 57 cents to $46.22 a barrel around 8pm. It earlier touched a low of $45.30, the lowest since 9 February 2005. London Brent crude was down 67 cents at $44.77.
Oil’s fall since July has echoed the global economy’s slide towards recession and tracked global stock market trends.
“With the oil market looking at equity markets for guidance, you need these to stabilize first before the oil market itself can recover,” said Harry Tchilinguirian, analyst at BNP Paribas. “Most days, you look at S&P futures (US equity futures) in the morning and you get a hint of what crude futures will do.”
Oil producer group Opec will consider another round of output curbs to try to defend prices when it next meets on 17 December in Algeria.
“For sure we will cut in Oran (Algeria),” Qatar’s oil minister Abdullah al-Attiya said on Wednesday.
Maryelle Demongeot in Singapore contributed to the story.