As OPEC's plans of another output cut currently seem confounded amid a bleak economic scenario, oil prices have slipped below US$56 levels in Asia on Monday. New York's main futures contract, light sweet crude for delivery in December, fell to US$55.7 a barrel, while Brent North Sea crude for January dipped to US$53.4.
An extraordinary meeting of OPEC is scheduled for November 29 in Egypt that could witness discussion of another production cut to counter oil prices that are plunging due to weak demand. However, comments by OPEC president suggest that output will not be lowered this month because the cartel members have not yet fully enforced previous quotas as well as the need by OPEC to collate more data before it reaches a decision.
On demand side, beside the slumping of world no 1- US economy, Japan's economy, the second largest in the world, slipped into recession in Q3 as companies slashed investment to weather the financial crisis, as well as data from European Union data showed that the 15-nation eurozone fell into recession for the first time ever, while government figures from Hong Kong showed the southern Chinese financial hub had also slipped into recession.