By Jonathan Davies

The global price of oil has fallen to its lowest level in more than two years after Saudi Arabia cut its prices.

Brent crude oil dropped 1% to $93 a barrel, the lowest it's been since June 2012. US crude oil fell below $90 for the first time in 17 months.

Saudi Arabia announced that it was reduced its price to maintain its market share.

It is understood that oversupply after high output in the US and the International Energy Agency (IEA)'s forecast of lower demand are driving prices down.

"This is a structural change in the oil market, with Saudi Arabia explicitly stating that they are willing to compete on price," said Bjarne Schieldrop, a commodities analyst at SEB.

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