A service station employee changes the price tag for gasoline at their station in Los Angeles, California, on November 20, 2008. The average price of a gallon of self-serve unleaded gasoline in Los Angeles County fell 3.3 cents on November 20 to 2.327 USD, nearly half the record high of 4.626 USD set on June 21, as falling crude oil prices point to a continuation of lower pump prices. [AFP PHOTO]

Crude oil fell to lowest level in more than three years below US$50 a barrel on Thursday as global economic downturn pared energy consumption.

Light, sweet crude for December delivery dropped US$4 to settle at US$49.62 a barrel on the New York Mercantile Exchange. Price slid to as low as US$48.64 a barrel, the lowest level last seen in May 2005.

In London, Brent crude for January delivery fell US$2.17 to US$49.55 a barrel on the ICE Futures Exchange.

"The price of oil continues to demonstrate weakness as the commodity has decisively violated the psychologically important price level of US$50 per barrel," Wall Street Strategies' senior research analyst Conley Turner told Xinhua. "At this juncture, the oil patch and oil related securities appear to present a lot of value to investors."

With economic growth in United States, Japan and Europe contracting, global oil demand is heading for the first annual decline in 25 years. Oil prices have lost nearly 66 percent since record high of US$147.27 a barrel reached in mid-July.

"However, this does not mean that it cannot get any cheaper," Turner said. "At this juncture, oil traders are following the stock market in the serve correction that is unfolding."

U.S. stocks tumbled Thursday as the Labor Department reported a highest jobless level in 16 years and Citigroup Inc's shares shed another 25 percent as investors questioned the bank's ability to withstand billions of additional loan losses in 2009.

Libya's top oil official told press on Thursday that OPEC may decide to take an another production cut at its meeting in Cairo next week.

But many analysts doubt if the OPEC supply cut can stable the oil price as its previous decision to reduce output had little impact.

"Below US$49 per barrel, oil is likely to trade in the low-US$40 in the next few weeks," Turner said.

(Xinhua News Agency November 21, 2008)