Updated from 12:21 p.m. EDT
Crude oil prices posted their seventh loss in eight sessions Tuesday, as the benchmark U.S. crude continued its sharp decline from a record high of almost $50 a barrel.
The October futures contract closed 16 cents lower at $42.12 in floor trading on the New York Mercantile Exchange. Prices closed at a four-week low Monday -- after snapping a five-session losing streak last Friday -- and are down about 15% from their peak on Aug. 20, when the September futures contract expired.
The much-anticipated correction in prices comes as worries about supply -- at a time of unusually high global demand -- have eased in the past week. Traders and analysts had been expecting a sizable correction after prices routinely hit record highs in the first three weeks of August, driven by a host of worries about exports from Iraq, Russia and Venezuela, three top oil-producing countries. Prices rose almost 20% alone during that period in August.
The latest attacks on Iraq's oil industry apparently failed to disrupt exports. Violence in Iraq, including persistent sabotage attacks on pipelines and other facilities, has periodically shut down or slowed exports from the country and became a daily factor in the market's supply-and-demand equation.
Traders also have focused on Russia, where uncertainty has surrounded the outcome of the high-stakes tax battle between the government and Russian oil giant
-- a tug-of-war drama that has sparked frequent concerns for its potential to slow exports.
The enormous rally in August followed a brief correction in prices in July after their previous June high, as the Organization of Petroleum Exporting Countries increased its official production level by some 2.5 million barrels a day. OPEC Monday said it would increase production even further in the coming months, according to media reports.