In less than a month crude oil, which some saw hitting $200 a barrel by year-end, has plunged $32 but a rebound could happen, for example, over the Iranian nuclear crisis, analysts say. From a record-high $147.27 on July 11, the New York futures contract slid to about $115 on Friday, losing almost 22 per cent in the course of four weeks.

In its wake, most other commodity prices, which were driven higher by the oil market surge, have fallen from their peaks.

An ounce of gold has dropped to $800 from $1,000; farm commodity prices are between 25pc and 40pc lower and petrol prices have dropped about 6pc.

“Oil is at a tipping point. It is an exaggeration to cry that a bubble has burst. It is a break, Oil market was not in a bubble.”

For James Williams at WTRG Energy, the law of supply and demand reins.

“The market is simple reflecting the fundamentals of supply and demand. Markets participants are considering the world slowdown, the deterioration in expectations for the growth worldwide,” Williams said.

The slowdown in economic growth has a significant impact on energy consumption, analysts say.

A case in point is US drivers, known as huge consumers of petrol, drove a third less in May compared with a year ago. Motor fuel consumption fell more than 2pc.

This trend is expected to extend to the emerging market countries where the increasing weakening of fuel subsidies is going to force consumers to fill up their tanks less.

By contrast, petroleum inventories which had slumped early in the year, are rebuilding. The world’s largest energy consumer, the US, has witnessed an increase in its crude oil reserves in recent weeks.

“When investors realised how much demand was increasing, they bid up prices. and when they realised how much inflation was increasing … they bid up prices further.”

“Now growth rates are declining throughout the world, the market overreacts to that, too”.

Swept up in the record run-up of oil prices, analysts had revised upward their this year’s price forecasts, with some talking about $200 a barrel in the next six months.

Those scenarios, disastrous for the world economy, have been replaced by a more modest range: between $80 and $110 a barrel at the end of the year. But a return to the forefront of problems with energy supplies could once again send prices skyward, analysts warn.

They point notably to the escalating tensions between the US and Iran over Tehran’s nuclear program, which could threaten overstretched global supplies, Antoine Halff of Newedge Group says.

Iran, the second-largest oil producer in Opec, has warned that it would shut the Strait of Hormuz, where 40pc of the world’s oil exports transit, if its interests are threatened.

The explosion of growth in the Chinese and Indian economies and a rebound in growth in the industrialized countries in 2009 could also stoke demand, pushing up prices.

“You should convince millions of Chinese and Indians, who are willing to live an American way of life, that they don’t have to buy cars, they don’t need (a) fridge,” MF Global’s John Kilduff joked.