THE oil market extended one of its steepest declines in recent years with Brent crude plummeting past the $60 a barrel mark after the influential oil cartel Opec met in Vienna to decide production levels for the next six months.
Prices fell sharply as traders remained concerned that Opec would fall short of expectations, amid mounting pressure from US President Donald Trump, who is agitating for a reduction in the cost of crude.
Brent crude fell as much as 5pc in afternoon trade before settling 3pc down at $59.67, while West Texas Intermediate tumbled below $51 a barrel before ending 3.1pc lower at $51.24.
Opec agreed a tentative oil production cut during the meeting but said it was waiting to hear from non-Opec member Russia, a key ally of the cartel, before deciding the exact volumes. The group will release further details today.
Shares in oil and gas giant BP fell 23.7p to 503.3p on the back of the news, while Premier Oil ended 11.45pc, or 8.55p, lower at 66.10p
Stock markets nosedived across the board yesterday after the arrest of Meng Wanzhou, the chief financial officer of Huawei. Investors worried the relationship between Washington and Beijing would be strained with the Chinese business woman facing possible extradition to the US.
The FTSE 100 suffered its worst day of trading in two years, closing 217.79 points down, or 3.15pc, at 6,704.05, with the FTSE 250 finishing 517.79 points, or 2.83pc, lower at 17,753.31.
Stocks in Europe followed suit, with the German DAX slipping 389.26 points, or 3.48pc, to 10,810.98 and the Paris CAC 40 falling 163.90 points, or 3.31pc to 4,780.46.
Antofagasta was the biggest large-cap faller in the UK, down 7.07pc to 760.0p, while luxury fashion firm Ted Baker was among the mid-cap winners.
Shares at the clothing retailer rose 1.55pc to £14.90 after it reported that retail sales jumped 2.3pc and online sales rose 18pc in its latest trading update. Stocks were hit on Monday following allegations of inappropriate behaviour by the firm’s founder and chief executive, Ray Kelvin. The company confirmed it had hired a law firm to investigate the harassment claims.
Meanwhile shares in struggling tour operator Thomas Cook wiped out Wednesday’s gains, down 1.74p, or 5.1pc, to 32.66p. It has been a turbulent few weeks for the travel firm after shares fell to their lowest level since 2013 following its third profit warning of the year.
FTSE Russell, the global index provider, on Wednesday confirmed that Thomas Cook would be one of the six companies exiting the FTSE 250 index in the December 2018 quarterly review.