By Henning Gloystein
International Brent crude futures were at $53.19 per barrel at 0544 GMT, down 61 cents, or 1.1 percent, from their final close of 2018.
West Texas Intermediate (WTI) futures were at $44.95 per barrel, down 47 cents, or 1 percent.
In physical oil markets, Dubai crude averaged $57.318 a barrel for December, the lowest since October 2017, two traders who participate in the market said on Wednesday.
Similarly, Malaysia's Petronas set the official selling price of a basket of December-loading Malaysian crude grades at $62.79 a barrel, the lowest since October 2017, the state oil firm said on Wednesday.
Traders said futures prices fell on expectations of oversupply amid surging U.S. production and concerns about a global economic slowdown.
Factory activity weakened in December across Asia, including in China, as the Sino-U.S. trade war and a slowdown in Chinese demand hit production in most economies, pointing to a rocky start for the world's top economic growth region in 2019.
Independent market analyst Greg McKenna said in a note on Wednesday that it was "difficult for traders and investors to ignore what looks like a genuine global economic slowdown."
That is also impacting sentiment in oil markets. Oil prices ended 2018 lower for the first time since 2015, after a desultory fourth quarter that saw buyers flee the market over growing worries about too much supply and mixed signals related to renewed U.S. sanctions on Iran.
"Oil prices ... registered their first yearly decline in three years on fears of a slowing global economy and concerns of an ongoing supply glut," said Adeel Minhas, a consultant at Australia's Rivkin Securities.
For the year, WTI futures slumped nearly 25 percent, while Brent tumbled nearly 20 percent.
The outlook for 2019 is riddled with uncertainty, analysts said, including the U.S.-China trade concerns and Brexit, as well as political instability and conflict in the Middle East.
A Reuters poll showed oil prices are expected to trade below $70 per barrel in 2019 as surplus production, much of it from the United States, and slowing economic growth undermine efforts led by the Organisation of the Petroleum Exporting Countries (OPEC) to cut supply and prop up prices.
On the production side, all eyes will be on the ongoing surge in U.S. output and on OPEC's and Russia's supply discipline.
"Don't underestimate shale producers and the wider U.S. oil industry in general. Too often this year the market pushed stories ... bottlenecks (pipelines, frack crews, truck drivers, etc.), yet U.S. oil production will have grown by a massive 2+ million barrels per day between 1.1.2018 and 1.1.2019," consultancy JBC Energy said in an analysis of 2018.
U.S. crude output rose to an all-time high of 11.537 million barrels per day (bpd) in October, the Energy Information Administration (EIA) said on Monday. That makes the U.S. the world's biggest oil producer ahead of Russia and Saudi Arabia.
Weekly data, which is more open to revisions, was reported last week at 11.7 million bpd in late December by the EIA.
(Reporting by Henning Gloystein; editing by Richard Pullin and Christian Schmollinger)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)