A slump of 2.5% for the FTSE 100 Index left blue-chip investors nursing losses of more than £112 billion following a disastrous week for global markets.

The worst week for London's top flight since August 2011, with shares down by 6.6% since Monday morning, reflected the tumbling price of oil and renewed jitters over the strength of the global economic recovery.

The FTSE 100 Index finished Friday's session 161.1 points lower at 6300.6 after the price of Brent crude set a new five-and-a-half year low of 62 US dollars a barrel.

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It had been 115 US dollars in June but has been driven lower by weakening demand and the prospect of oversupply as Saudi Arabia battles for market share with US shale producers.

Today, the International Energy Agency cut its forecast for global demand for the fourth time in five months.

Oilfield services firm Petrofac slid by more than 6%, while BP and Royal Dutch Shell were down by around 3% after the latest price fall. BP shares have fallen by 9% since Monday and are 20% cheaper in the year to date.

Demand for mining stocks has also been weakened by the outlook in China, with the world's second largest economy today reporting a decline in growth in industrial output.

BHP Billiton was off 36p at 1325p and Rio Tinto fell 65.5p to 2682.5p.

The sell-off also covered the retail sector after Next dropped 160p to 6385p and Dixons Carphone slipped 14.3p to 421.6p.

Insurer Aviva was down 4% after insurance analyst Eamonn Flanagan of Shore Capital Stockbrokers reiterated his sell rating and warned the company's acquisition of Friends Life presented a significant "execution risk" due to the plethora of companies, systems and products which have to be integrated.

The shortened risers board was led by water companies after the industry regulator Ofwat told firms to cut household bills in real terms by 5% over the next five years.

The decision confirms a provisional determination in August and was met with relief by investors in Severn Trent and United Utilities as the pair's shares rose 22p to 1937p and 31p to 903p.

Investec analyst Roshan Patel said the final determination by Ofwat gave a "balanced outcome" for shareholders.

Outside the top flight, shares in Hargreaves Services slumped 13% after it announced the closure of its Monckton coke works and said the outlook for its surface coal mining operations had been hit by falling prices.

The sites are performing well but 2016 forward coal prices have fallen by a further £4 per tonne in the last three months. Shares fell by 88p to 602p.

Meanwhile, housebuilder Bellway dipped 3% or 55p to 1837p after it said trading has returned to a more normal seasonal pattern, although its reservation rate has remained "robust" at 147 a week.

The biggest FTSE 100 risers were United Utilities up 31p at 903p, Severn Trent ahead 22p at 1937p, Sainsbury's up 1.2p at 227.5p and Weir ahead 4p to 1699p.

The biggest fallers were Petrofac down 46p at 678p, Coca-Cola HBC off 72p at 1256p, Aviva down 19.1p at 468p and St James's Place off 30.5p at 775p.

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