Oil prices dropped today, with Brent crude falling close to $50 a barrel, as weak energy demand continued to plague the market.
Brent North Sea crude for delivery in January was down seven cents at $51.77 a barrel in late afternoon trade on London's InterContinental Exchange. Earlier it touched a low of $50.61.
On the New York Mercantile Exchange, light sweet crude for December delivery slipped 53 cents to $53.86 a barrel. It earlier fell to $53.30, the lowest point since January 2007.
Crude oil prices have plunged almost two-thirds since striking record highs of above $147 in July as a global economic slowdown dents world energy demand.
The US government's Department of Energy said today that stockpiles of distillates, including heating fuel and diesel, sank unexpectedly last week. Reserves of distillates fell by 1.5 million barrels in the week ending November 14. Analysts' consensus forecasts had been for a gain of 400,000 barrels.
Traders are moving their attention towards distillates with the approach of the northern hemisphere winter - when demand for heating fuel hits a peak.
The DoE added that US crude stockpiles rose by 1.6 million barrels last year, while motor fuel reserves increased by 500,000 barrels.
The weekly stocks update is important for the market because the US is the biggest oil consuming nation in the world.
Prices in London had last week slumped to three-and-a-half-year lows close to $50, prompting the OPEC exporters' cartel to call an emergency meeting in Cairo to discuss output levels.
The London-based Centre for Global Energy Studies yesterday forecast a contraction in global demand for the first time in 25 years amid a severe global economic slowdown.
On Monday, the Organisation of Petroleum Exporting Countries, whose members produce 40% of the world's oil, said it was ready to intervene on a regular basis to help prop up the prices.