By Daniel Hunter
The price of Brent crude oil hit a fresh four-year low today (Thursday).
The price fell to $79.38 following weak economic data from China which contributed to warnings that the world could see a 'glut' of oil.
It's the first time the price has fallen below $80 since September 2010.
The US Energy Information Administration cut its output forecast and predicted that Saudi Arabia would cut production.
Saudi oil minister Ali al-Naimi said: "Talk of a price war is a sign of misunderstanding, deliberate or otherwise, and has no basis in reality.
“We want stable oil markets and steady prices, because this is good for producers, consumers and investors.”
Edward Knox, currency analyst at Caxton FX, believes weak inflation forecasts and falling oil prices will only add to woes in the eurozone.
He said: "With the oil price continuing to drift with very little support, and increasing geo-political risks today’s announcement will have done no favours for Mario Draghi [President of the European Central Bank] and his team.
"Monetary easing is a tool that they still have in their locker, and the pressure to use this will have increased this morning. Mounting expectations of further stimulus down the line will most likely have a negative impact on the single currency going forward. The US dollar, backed by the resurgent US economy is the currency most primed to take advantage of the weaker outlook in the euro zone."
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