WTI oil falls nearly 5% to trade below $47 after IMF cut global economic forecast

On Tuesday West Texas Intermediate oil futures sold off steeply, after the International Monetary Fund reduced its global economic growth forecast and China’s economy expanded at its slowest pace in 24 years.

Crude oil for delivery in March tumbled $2.38, or 4.84%, to trade at $46.75 a barrel during U.S. morning hours, after hitting a session low of $46.72 on the New York Mercantile Exchange. On Monday New York-traded oil futures tumbled $1.27, or 2.58%, to settle at $47.86 a barrel. WTI prices hit $44.20 on January 13, a level not seen since March 2009.

Brent oil for March delivery declined 88 cents, or 1.79%, to trade at $47.97 a barrel on the ICE Futures Exchange in London. On Monday, London-traded Brent prices fell $1.33, or 2.65%, to close at $48.84 a barrel. Brent hit $45.19 on January 13, the weakest level since April 2009.

The International Monetary Fund cut its global growth outlook for 2015 to 3.5% from a previous estimate of 3.8%, citing slowing economies in China, Russia, the euro zone and Japan.

More to that, official data released earlier showed that China’s economy grew 7.4% in 2014 from a year earlier, below the government's official target of 7.5% and the slowest pace since 1990. It expanded 7.7% in 2013.

In the fourth quarter, China's economy expanded at an annual rate of 7.3%, beating expectations for 7.2% and holding steady from the prior quarter. China is the world's second largest oil consumer after the U.S. and has been the engine of strengthening demand.

Oil prices have fallen nearly 60% since June as the Organization of Petroleum Exporting Countries resisted calls to cut output, while the U.S. pumped at the fastest pace in more than three decades, creating a glut in global supplies.