This article is more than 1 year old

This article is more than 1 year old

The oil price has slumped to its lowest point this year, as concerns mount about a glut of crude supply and fears that economic headwinds could lessen demand.

Brent crude fell as low as $59.26 a barrel on Friday, a level last seen in October 2017. Three supermarkets said on Friday they would cut petrol prices, as Asda cut its national price cap by 1p per litre for petrol and 2p per litre for diesel, with Morrisons and Sainsbury’s following suit.

After reaching a high of more than $86 a barrel in early October, which prompted warnings that it would climb further to $100, the oil price has since plunged by more than 30%.

But some industry observers said they expected it to recover next year if Opec took action to avoid an oversupply of crude.

The price is expected to average $75.50 a barrel in 2019 compared with $73.91 this year, according to a survey of 11 oil forecasters by S&P Global Platts.

The recent fall follows US waivers for eight countries to import oil despite sanctions on Iran, high output and markets worried about a drop in demand. Jefferies bank said: “The market is currently oversupplied.”

Earlier this week, Donald Trump thanked Saudi Arabia, the de facto leader of Opec, for pumping more and bringing down the price, but the US president said he wanted to see it lower still.

Donald J. Trump (@realDonaldTrump) Oil prices getting lower. Great! Like a big Tax Cut for America and the World. Enjoy! $54, was just $82. Thank you to Saudi Arabia, but let’s go lower!

The oil cartel is due to meet in Vienna in a fortnight to discuss what major producers should do next.

Khalid al-Falih, the Saudi energy minister, has previously indicated a significant cut in output is needed. This week, he said the kingdom’s current high exports were likely to be lower in December and January. “We will not sell oil that customers don’t need,” he said.

If Opec agrees production curbs on 6 December, this would imply a rebound in prices next year.

But experts said the pressure from Trump and his close links to the Saudi crown prince, Mohammed bin Salman, meant it would be hard for the country to agree such a move.

The analysts Petromatrix said: “Our view remains that it will be politically difficult for Saudi Arabia to organise a coordinated Opec supply cut.”

Analysts believe the oil price will continue to be volatile in the coming months, with UBS bank saying this was “inevitable” and a price of $60 a barrel was plausible.