A barrel of West Texas Intermediate (WTI) was $69.36 a barrel in late morning trading on the New York Mercantile Exchange on 16 October, a 7 per cent drop on the previous day and a slump of more than half on the all-time record of $147.27 on 11 July.

Part of the reason for that was due to a record drop in US industrial production in September due to the effect of the credit crunch combined with hurricanes and an aircraft strike.

Slowing oil demand also contributed to lower prices, with US oil inventories rising by 5.6 million barrels to 308.2 million barrels in the week ending 10 October, almost twice the forecast level.

Opec, reacting to the sharp decline in prices, has brought forward its next extraordinary meeting in Vienna to 24 October, from the previous date of 18 November.

Although analysts expect Iran, Nigeria, Qatar, Libya, Iraq and Kuwait to move towards a production cut at the meeting, investment bank Barclays Capital notes that Saudi Arabia, Opec’s most influential member, is showing no signs of taking any action to stem the slide in prices.

The bank says Riyadh has notified major Asian refiners that it will maintain the volume of crude oil shipments next month.