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Economic Fears Send Oil Below $36 a Barrel

Fears the global economy will get worse dropped oil prices to levels not seen in 4.5 years.

Investors shrugged off Wednesday's record production cut by OPEC, the Organization of Petroleum Exporting Countries, pushing crude oil prices to less than $36 a barrel. Oil moved slightly higher at the close of New York trading Thursday.

Prices have now tumbled more than 70 percent since July's record-high. And some economists say prices could drop even further as global economic problems cut demand.

Oil is not the only commodity dropping in value. The United Nations Food and Agriculture Organization says world cereal prices are falling due to increased global production. But officials warn cereal prices remain too high in developing nations, including those, like Afghanistan, Eritrea and Ethiopia, with vulnerable populations.

Meanwhile, World Bank President Robert Zoellick is urging governments not to resort to protectionism.

Zoellick told reporters in Singapore today the first half of 2009 will see problems with economic growth worldwide, especially in Asia. But he says China and other nations are well prepared to handle the current crisis, after years of sustained economic growth.

In Turkey, where concerns about a slowing economy are also growing, the central bank slashed its key interest rate 1.25 percent, to 15 percent. And in Ireland, the country once called the "Celtic Tiger" for its fast-growing economy got more bad news. Ireland's top economic research institute predicted the country's recession would be deeper than expected.

Ireland's Economic and Social Research Institute says the country's gross domestic product - a measure of all the goods and services produced - would shrink by almost four percent in 2009. Irish Prime Minister Brian Cowen unveiled a more than $700 million, or 500 million euro recovery plan.

In Switzerland, banking giant Credit Suisse said it will still give year-end bonuses to senior managers. But the bank said it will pay those bonuses with some of the risky securities that are blamed for sparking the global financial crisis.

Also today, the European Parliament approved a plan that would require European Union members to guarantee bank deposits of up to $144,000, or 100,000 euros. The plan ensures depositors can recover more of their savings should a bank fail.

Some information for this report was provided by AFP, AP and Reuters.