Boston: Oil prices slumped more than 6 per cent on Friday, with Brent set for a 12 per cent plunge this week, as fears that supply would overpower demand intensified, even as major producers considered cutting output.

Oil supply, led by US producers, is growing faster than demand and to prevent a build-up of unused fuel such as the one that emerged in 2015, the Organization of the Petroleum Exporting Countries is expected to start trimming output after a meeting on December 6.

But this has done little so far to prop up prices, which have dropped more than 20 per cent so far in November, in a seven-week streak of losses. Deep trade disputes between the world’s two biggest economies and oil consumers, the United States and China, have weighed upon the market.

“The market is pricing in an economic slowdown - they are anticipating that the Chinese trade talks are not going to go well,” said Phil Flynn, an analyst at Price Futures Group in Chicago. “The market doesn’t believe that OPEC is going to be able to act swiftly enough to offset the coming slowdown in demand.”

Brent crude oil fell $3.81, or 6.1 per cent, to $58.79 a barrel by 21.30 IST (1600GMT), after earlier touching $58.57, its lowest since October 2017. US West Texas Intermediate crude (WTI) lost $3.75, or 6.8 per cent, to trade at $50.88, to touch a low of $50.60, also the weakest since October 2017.

For the week, Brent was on track for a 11.9 per cent loss and WTI a 9.7 per cent decline.

Prices were on course for their biggest one-month decline since late 2014.

Market fears over weak demand intensified after China reported its lowest gasoline exports in more than a year amid a glut of the fuel in Asia and globally.

Stockpiles of gasoline have surged across Asia, with inventories in Singapore, the regional refining hub, rising to a three-month high while Japanese stockpiles also climbed last week. Inventories in the United States are about 7 per cent higher than a year ago.

Crude production has soared as well this year. The International Energy Agency expects non-OPEC output alone to rise by 2.3 million barrels per day (bpd) this year. Oil demand next year, meanwhile, is expected to grow by 1.3 million bpd.

Adjusting to lower demand, top crude exporter Saudi Arabia said on Thursday that it may reduce supply as it pushes OPEC to agree to a joint output cut of 1.4 million bpd. However, US President Donald Trump has made it clear that he does not want oil prices to rise and many analysts think Saudi Arabia is coming under US pressure to resist calls from other OPEC members for lower crude output.

If OPEC decides to cut production at its meeting next month, oil prices could recover sharply, analysts say.

“We expect that OPEC will manage the market in 2019 and assess the probability of an agreement to reduce production at around 2-in-3. In that scenario, Brent prices likely recover back into the $70s,” Morgan Stanley commodities strategists Martijn Rats and Amy Sergeant wrote in a note to clients.