Oil above 36 dollars, lowest levels in four years

New York's main futures contract, light sweet crude for delivery in January, rose 15 cents to 36.37 dollars a barrel, off its morning low of 36.04.

The contract dived 3.84 dollars to 36.22 dollars, its weakest finish since July 2004, on the New York Mercantile Exchange Thursday.

Brent North Sea crude for February delivery gained 18 cents to 43.54 dollars a barrel after slumping 2.17 dollars to settle at 43.36 dollars a barrel on Thursday in London.

Prices held reasonably steady as traders did not want to take unnecessary risks in a ‘crazy market,’ said Ken Hasegawa, manager of the energy desk of Newedge Japan brokerage.

He added traders were watching the market carefully after recent events, and their reluctance might also be because of the expiry later Friday of New York's January futures contract.

However, Hasegawa expected buyer interest to return soon. ‘After the new year, everyone will jump back in,’ he said.

A slowing global economy and resulting fears of weaker energy demand have pulled prices down from record highs of 147 dollars a barrel reached in July.

In a bid to shore up prices, ministers of the Organisation of the Petroleum Exporting Countries (OPEC) on Wednesday approved a record output cut of 2.2 million barrels a day, about 7.0 percent of the cartel's output quota.

Before the latest cuts, OPEC's official daily output target was 27.3 million barrels a day.

Analysts had questioned whether the latest reduction would be sufficient against rapidly falling demand with some of the world's leading industrialised oil consumers -- the United States, Germany and Japan -- already in recession.

Others, including China, are experiencing sharp slowdowns.