A renewed plunge in oil prices is a worrying sign of weakness in the global economy that could shake governments dependent on oil revenues. Yet it is also a bonus for consumers as prices fall at the pump, giving individuals more spending money and lowering costs for many businesses.

The latest slide follows Opec's decision to leave its production target at 30 million barrels a day. Member nations of the group are worried they'll lose market share if they lower production, according to a report in the Gulf Daily News,our sister publication.

Partly because of the shale oil boom in the US, the world is awash in oil at a time when demand from major economies is weak , so prices are falling. Citibank analysts wrote in a report that global supplies exceed demand by about 700,000 barrels a day now.

The price of US crude oil dropped $7.54 a barrel, or 10 per cent, to $66.15 on Friday and is down 38 per cent since hitting $107 in June. Brent crude, an international benchmark, fell 3 per cent to $70.15 a barrel on Friday.

Oil Price Information Service chief oil analyst Tom Kloza expects the price to fall by another $5 or $10 a barrel before stopping. 'It's that kind of rout,' he said.

Overall, the slide is a boon for consumers in oil-importing regions like Asia, Europe and North America. But there are also some possible negatives.

US consumers have been surprised and delighted at the lowest petrol prices since 2010. Drivers in some low-cost states such as South Carolina, Missouri, Oklahoma and Texas could see prices below $2, according to Kloza.

The US national average was $2.79 on Friday. Kloza expects petrol to eventually be a full $1 per gallon below its June peak of about $3.70 a gallon. That would save typical households $60 a month for those that burn 60 gallons of fuel.

The bottom should come between $2.50 and $2.70 a gallon, Kloza says.

Canadian consumers are also catching a break. In some regions, such as southern Ontario, petrol could fall below the important psychological barrier of $1 per litre.

Oil companies propelling a production boom in Canada and the US won't be so happy. Crude produced in Canadian oil sands, deep offshore in the Gulf of Mexico and in some US onshore shale formations is some of the most expensive oil to produce in the world.

Drillers will have to cut back at least some activity. Forcing this kind of slowdown may have been part of Opec's motivation for declining to cut its own production.

Many of Europe's economies are net importers of oil, so lower prices are likely to give a welcome, if small, boost to growth.

Declining fuel prices also, however, add to one of the euro zone's biggest headaches: low inflation. Weak inflation makes it harder for troubled economies like Greece to reduce debt. It is also a problem for the European Central Bank, which wants to boost inflation from just 0.3 per cent currently to around 2 per cent. – Reuters