Brent crude futures fell below $90 a barrel on Friday, close to a four-year low, as rising supply and more grim economic news stretched a months-long slump in oil prices.
U.S. crude also slumped nearly $2 to hit its lowest since 2012, but expectations that OPEC would intervene by reducing its production have been thrown into doubt as its members appeared to be locked in a price war.
"It's panic mode. Panic and capitulation. We are now in uncharted territory, so anything could happen," said Carsten Fritsch, commodities analyst at Commerzbank, adding that without some action from OPEC, prices will "continue a freefall".
"The rout will probably continue until OPEC says enough is enough."
Brent crude for November delivery was down 60 cents at $89.45 a barrel by 0957 GMT, after falling earlier to $88.11 - its lowest since December 2010.
Brent has fallen nearly 24 percent since hitting this year's high of $115.71 in June, and is in line for a third straight week of losses, as growing supply from Libya and the United States has met softer economic data from Europe and Asia.
U.S. November crude dropped $1.20 to $84.57 a barrel. The contract, also known as West Texas Intermediate (WTI), hit a session low of $83.59, its lowest since July 2012.
Concern about a recession in Germany was compounded early on Friday as two sources in the ruling coalition said Europe's largest economy would cut its growth forecasts for 2014 and 2015 next week. The news followed data earlier this week that showed exports in Europe's largest economy fell in August by the most since January 2009.
China, the world's second-largest oil consumer, is also seeing signs of a slowdown. Data due next week is forecast to show that softer domestic demand probably slowed growth in China's imports, investment and retail sales to multi-month or multi-year lows in September.
U.S. crude inventories also soared far more than expected last week on higher imports and as refineries cut output.
But cuts to Iran's official selling prices that brought them to near six-year lows raised more doubts about the group's willingness to curtail supply in an effort to stabilise prices. Fritsch called the price cut "a devastating signal", and analysts said other producers could follow suit.
"They're all fighting for market share through the official selling prices," said Olivier Jakob, managing director of PetroMatrix. "They're really not showing any signs, and Saudi Arabia has not shown any signs, that they will cut production."
Any action is unlikely before OPEC's Nov. 27 meeting. On Thursday, the main reference price for OPEC crude oil exports fell to its lowest since 2010, tracking the slump in global oil benchmarks.
The relentless decline in oil prices prompted investment bank Barclays to slash its average fourth-quarter forecast for Brent to $93 a barrel from $106 previously. It also cut its estimate for WTI to $85 from $98.