Oil’s dismal start to the new year continued yesterday as prices plumbed fresh lows, with Morgan Stanley adding to a growing number of voices warning that prices could slide to $20 a barrel.

Brent, the global oil marker, fell by more than $2, or 6 per cent, to $31.48 a barrel in late trading, a level last reached in April 2004. Across the Atlantic, meanwhile, West Texas Intermediate, the US benchmark, dropped more than 6 per cent to $30.97 a barrel, a fresh 12-year low.

The falls extended to 16 per cent a rout that had seen more than 10 per cent knocked off both benchmarks in the first trading week of 2016. “Oil in the $20s is possible,” said Morgan Stanley analyst Adam Longson in a report that focused on the possibility of China further devaluing its currency against the US dollar.