The oil cartel also lowered its 2019 oil demand growth forecast by 70,000 b/day to 1.29 mb/day; it has been lowering its estimates for every month since July.
US futures were on track to close lower for a record 12th straight session, with Tuesday's selloff the worst yet.
Energy stocks tumbled on Wall Street - threatening a wider stock market recovery on Tuesday - as a string of funds shed their long term oil positions, market participants reported.
"It's like a run on the bank". He told the Straits Times that "it's getting to the point where it doesn't seem to be about fundamentals anymore, but a total collapse in price".
OPEC warned on Tuesday that an oil supply glut could emerge in 2019 as the world economy slows and supply from rival producers rises more quickly than expected, building a case for a policy U-turn to cutting output at a meeting December 6.
That led to a sharp price drop on Monday and the sell-off continued into Tuesday.
A sudden u-turn in prices, however, isn't expected to be around the corner based on an analysis of Bollinger bandwidths.
Why are oil prices falling?
U.S. West Texas Intermediate (WTI) crude oil futures were at $55.52 per barrel at 0732 GMT, down 17 cents, or 0.3 percent, from their last settlement. It was the largest one-day percentage decrease for the contract since September 2015. United States crude has lost 28 per cent since its early October peak. Kazakhstan said on Tuesday its oil output rose 4.8 per cent to 74.5 million tonnes in the first 10 months of 2018, equivalent to 1.82 million bpd. It now sits at levels not seen since March. The commodity is now in bear market territory, having lost more than 20 percent off its recent high.
Riyadh indicated on Monday it was on course to ignore the USA president's wishes at OPEC's next meeting due in December because it saw a need to reduce OPEC output by a collective one million barrels per day during 2019.
In this context, then, it is no surprise OPEC officials, notably Saudi Arabia's Khalid al-Falih have started to talk about production cuts again for fear of another glut like the one that dragged prices below US$30 a barrel four years ago. USA crude oil stockpiles are on the rise, with expectations of additional Permian supply coming online once new pipelines become operational. In addition, Russian Federation has given mixed signals about a cut, with Lukoil CEO Vagit Alekperov saying Monday he did not see cuts being necessary.
"Twelve days in a row is insane - but there are a lot of pieces putting pressure on the market", said Bob Yawger, director of energy futures at Mizuho.