Oil prices fall to 2007 levels

Global panic about the economic downturn has sent oil prices to a 20-month low, sending commodity stocks lower on the FTSE 100.

US light sweet crude fell to $57.90 a barrel in New York, a 60 per cent drop from its July peak, before rebounding to $58.40, while UK Brent crude declined $1.20 to $54.51 a barrel.

Booming economies around the world, particularly in China and India, have been fuelling the demand for oil over recent years.

But the economic downturn, started in the US, has spread to other economies and as demand has fallen, so has the price.

Iran's oil minister has told reporters the Organisation of Petroleum Exporting Countries (Opec) may call an emergency meeting before December's scheduled conference if the price continues its dramatic slide.

The cartel can order member countries to scale back production in order to match demand, forcing prices up.