Due to increased supply and the slowing of global growth, the price of Brent crude oil has fallen sharply to below US$50 per barrel.
According to the BBC, the price fell to $49.92 recently, the first time this has happened since 2009 when the world was in the firm grip of recession.
The price of oil has halved since June 2014 when it was recorded at $110 per barrel.
Prices are anticipated to fall further as North American shale producers carry on supplying increasing quantities of oil and gas.
Oil-producing group Opec has resisted calls for oil production cuts to support prices.
CMC Markets Analyst Michael Hewson, said: “With no sign that Opec will do anything about over-production, it seems likely that we could well see further declines towards $40 in the coming weeks.”
Gulf economies are said to be spending money on oil regardless in a bid to continue their economic growth, to the point of a potential deficit.
Iain Armstrong, Oil Market Analyst at investment management firm Brewin Dolphin, said: “All the net exporters of oil are the ones that are suffering at the moment.
“Unless you're lucky enough to be tied to the dollar, your currency is going to be in big trouble, i.e. just like Russia.”
Commenting on the benefits this could have on consumers, British Chancellor George Osborne tweeted that it is “vital this is passed on to families at petrol pumps, through utility bills and air fares”.
Oil Price in Freefall. (Source: BBC)