Oil fell as much as five per cent today after the International Monetary Fund cut its 2015 global economic forecast on lower fuel demand and key producer Iran hinted prices could drop to $25 a barrel without supportive OPEC action.

An expected slide in the US oil rig count in the first quarter compared with the fourth quarter of last year failed to boost sentiment as traders and investors remain glued on concerns of oil oversupply.

Oil prices are hovering near six-year lows after a seven-month long selloff on worries of a glut caused primarily by unexpectedly high production of U.S. shale crude.

Benchmark Brent crude was down 48 cents at $48.36 a barrel after touching a session low at $47.78.

US crude traded down $2.12 at $46.57, after an intraday bottom at $46.23.

"Because we have record oil production now, the falling rig numbers are not creating an immediate positive impact in bolstering prices," said Phil Flynn, analyst at Price Futures Group in Chicago. "In fact, they may be creating just the opposite impact; reminding us how poor demand is."

U.S. oil services firm Baker Hughes Inc said in its conference call presentation on Tuesday the US average rig count was expected to decline 15 percent in the first quarter from a quarter ago, and it expected to lay off some 7,000 staff.

Earlier data from Baker Hughes showed the number of rigs drilling for oil in the United States fell by 55 last week, the second-sharpest weekly drop in 24 years.

The IMF, in its latest World Economic Outlook report, reduced its forecast by 0.3 percentage points for this year and next, projecting a 3.5 percent growth in 2015 and 3.7 percent for 2016.

"New factors supporting growth - lower oil prices, but also depreciation of euro and yen - are more than offset by persistent negative forces," said Olivier Blanchard, the IMF's chief economist.

Iran's Oil Minister Bijan Zanganeh said Tehran saw no signs of a shift within OPEC towards action to support oil prices, and that the industry could ride out a further slump toward $25.