Concerns of oversupply, slower global economy weigh on oil prices

Concern that there's too much oil for a slowing global economy sent a tremor through oil markets Tuesday, as the benchmark price for North American crude fell more than seven per cent to its lowest level since the summer of 2017.

Benchmark U.S. crude plunged to $46.24 a barrel in New York.

Brent crude, used to price international oils, sank 5.6 per cent to $56.26 a barrel.

The price of Western Canadian Select also fell $6.78, to $30.60 US a barrel.

Crude prices are under pressure as traders fret about a slowdown in the global economy and an increase in supply. Both would hurt prices.

While OPEC and several other countries recently agreed to cut production of oil in 2019, it was unclear whether the cut is large enough to balance supply and demand.

Adding to the pressure on oil prices, a new report from the U.S. Energy Information Administration said American shale oil production will keep climbing in the new year.