The price of oil shot up today amid hopes of an Opec production cut.

The Organisation of Petroleum Exporting Countries, producer of 42% of the world's oil, could this week make its biggest-ever oil-supply cut to combat shrinking demand, bulging stockpiles and the resulting plummeting prices.

By limiting supply, it hopes to put the brakes on a slide that has seen the price of oil plummet from almost $150 a barrel in the summer to recent lows of less than $40.

London Brent crude today rocketed $2.76 to $49.20. Opec secretary general Abdalla el-Badri said: “Stocks are very high. We need to take action at this time.”

The oil market was oversupplied to the tune of 100 million barrels, he added.

Speculators are thought to have gradually increased their bets on prices rising.

Opec is also attempting behind the scenes to persuade Russia — which is the biggest producer outside the cartel — to reduce its output by between 200,000 and 300,000 barrels a day.

“We did not ask anyone else to cut, but I hope they will act and help the market,” said el-Badri. “We are very pessimistic about demand.”

The International Energy Agency said last week that world oil demand will this year fall for the first time since 1983 when the figures are totalled.

A slowdown in demand from once oil-hungry China is cited as being the main cause of the current price slide.