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When the year began, not even the most pessimistic oil market expert dared predict the dramatic fall in prices that is now taking place on concerns of a supply glut and a possible price war among OPEC members.

In recent weeks, the price of a barrel of oil has tumbled by about a third to a level which, after allowing for inflation - $16.92 per barrel Wednesday - compares with those of earlier, ruinous gluts."Oil prices are back in real terms virtually to 1973 levels," said Mehdi Varzi, an analyst who follows the Organization of Petroleum Exporting Countries for London-based Kleinwort Benson Securities.

In that year, during an Arab oil embargo against the West, OPEC seized control of prices from the "Seven Sisters," the Western oil companies that it accused of conspiring to keep oil cheap.