Crude oil prices dropped to a 16-month low, dropping more than $4 a barrel as the global financial crisis made a big dent in petroleum fuel consumption.

Crude for December delivery touched a low of $67.50 per barrel in electronic trading on Globex, the weakest level since late June 2007. The contract was last down $4.10 (5.7 per cent) at $68.08.

Light sweet crude for December delivery on the New York Mercantile Exchange declined $4.25 (5.9 per cent) to $67.93 a barrel in late morning trade.

The market also discounted prospects of a production cut by OPEC at a meeting this week as rising US crude and gasoline supplies pulled prices down by as much as 6.5 per cent.

The decline was aided by a combination of factors, including the strengthening of the US dollar and a report that showed big increases in crude and product inventories coupled with an 8.5 per cent (1.7 million barrels) fall in total consumption from last year.

Oil prices, which have tumbled 54 per cent since reaching a record $147.27 on 11 July, are down 14 per cent from a year ago.
 
US crude supplies are expected to have increased for a fourth week, up 3.2 million barrels for the week ended 17 October, to 311.4 million barrels, according to the US energy department.