OPEC TO CUT AGAIN

The Organization of the Petroleum Exporting Countries is ready to cut production by a significant amount when it meets later this month.

Oil fell below $49 a barrel on Tuesday, after reversing early losses in response to a rally in U.S. and European shares.

It had earlier fallen to a new 3-1/2-year low below $48, weighed down by gloom over the ailing world economy and its impact on fuel demand.

U.S. light crude for January delivery was down 54 cents at $48.74 a barrel by 11:06 a.m. EST. It earlier touched a new 3-1/2 year low of $47.36, its lowest since May 2005.
Prices had dropped nearly 10 percent on Monday.

London Brent crude was down 69 cents at $47.28 a barrel after touching a low of $46.02, its lowest since February 2005.

OPEC has already cut supply by about 2 million barrels per day, but this has so far failed to bolster prices, which have fallen nearly $100 a barrel from a peak of more than $147 in July.

Top exporter Saudi Arabia has highlighted $75 a barrel as a "fair price" for oil.

Oil prices fall on economy fears

Oil prices fall on more bad economic news and after Opec hinted it would not cut oil production soon. US light, sweet crude fell more than $1 to $55.93 a barrel. Brent crude lost 52 cents to $53.72. Prices fell after Opec's president downplayed the chance of a November output cut, and demand for oil is expected to be hurt as more countries slide into recession, with Japan's economy the latest victim. Oil prices have dropped more than 60% since their record highs of nearly $150 a barrel in July.