Oil prices fell another 3.4 per cent to below $39 a barrel on Tuesday as a raft of gloomy economic data reinforced expectations that world energy demand will shrink for the first time in 25 years
OPEC, which has already agreed to slash global oil supplies by 5 per cent, may call an emergency meeting before March if the market extends its nearly $110 barrel slide since summer, OPEC's President Chakib Khelil said on Tuesday.
U.S. crude for February delivery fell $1.36 to $38.55 a barrel by 1745 GMT after dropping 6 per cent on Monday. London Brent dropped by $1.35 to $40.10.
Tuesday's losses came after U.S. government data showed the economy of the world's biggest energy consumer shrank 0.5 per cent in the third quarter as a credit and housing crisis took hold. Consumer spending, meanwhile plunged 3.8 per cent, the biggest drop since 1980.
The UK economy also shrank 0.6 per cent in the third quarter, the first decline there since the early 1990s, and data also showed recessions taking root in Spain and New Zealand.
The U.S. Energy Information Administration expects world oil demand to shrink in 2008 and 2009 due to the financial turmoil, marking the first declines since 1983.
Author:
Ksenia Kochneva
