Oil prices continued to fall today, turning back towards 12-year lows on persistent concerns about oversupply and the outlook for demand. 

Oil futures have hit their lowest since 2003 this week as investors worry that a glut of crude is combining with slowing demand due to economic weakness, especially in China. 

Benchmark Brent was down 16 cents at $27.72 a barrel this afternoon. Brent has lost 26% in January, on track for its biggest monthly fall since 2008. 

West Texas Intermediate (WTI) crude futures traded at $28.13 per barrel, down 22 cents from their previous close. 

US futures briefly turned positive, and Brent trimmed losses after European Central Bank President Mario Draghi said it would be necessary to review the bank's monetary policy stance in March. 

This led to increased expectations that there may be more quantitative easing. 

However broad market sentiment remained bearish as producers around the world pump 1 million to 2 million barrels of crude every day in excess of demand, creating a huge overhang of stored oil. 

Iran's return to the oil market this month added to the glut, after the lifting of international sanctions aimed at discouraging the country from obtaining nuclear weapons.

Analysts said that weaker demand in the Middle East, which has been hit by lower oil prices, could add fuel to the sell-off and there was little to stop crude falling to $20 per barrel.  

Indicating the glut may grow further, Iraq's Oil Minister Adel Abdul Mahdi told Reuters the country's southern region planned to increase output by up to 400,000 barrels per day (bpd) this year to over 4 million. 

Meanwhile, Venezuela has requested that OPEC hold an emergency meeting to discuss steps to prop up oil prices, although delegates from other members of the producer group said such a gathering was unlikely. 

Investors will watch for data from the Energy Information Administration later this afternoon for more detail on the extent of oversupply in the US. 

Analysts expect crude stocks to have risen by 2.8 million barrels in the week ended January 15, according to a poll of eight analysts. 

Data from the American Petroleum Institute, a US industry group, showed crude inventories rose by 4.6 million barrels.