Opec and non-member oil producers have moved closer to clinching a deal on extending output cuts by nine months to clear a global stocks overhang and prop up the price of crude.

Oil prices will continue to drop as high production meets weak demand and a strong dollar pressures crude, and markets will only pick up once major manufacturing economies particularly in Asia feel the benefit of cheaper energy.

OPEC producers agreed a surprise cut in oil supplies yesterday that could raise fuel costs this winter and hamper economic growth.