LONDON - World oil prices recovered slightly on Thursday as investors snapped up bargain crude after it had slumped in London and New York the previous day on concerns over the US “fiscal cliff” and European debt.

Brent North Sea crude for delivery in December won 83 cents to $107.65 a barrel in late morning trade. New York’s main contract, light sweet crude for December or West Texas Intermediate (WTI), increased 68 cents to $85.12 a barrel.

Crude futures had plunged by more than $4 a barrel on Wednesday, giving up Tuesday’s sharp gains and more, as markets also reacted to gloomy EU economic forecasts. “We had quite a large move down (Wednesday) as the worries over the fiscal cliff and European woes started to more than usurp the euphoria” over the re-election of President Barack Obama, said Jason Hughes, analyst at trading group IG.

“Prices have pushed back up... it’s probably people covering positions after a big move,” the Singapore-based analyst told AFP. Wednesday’s sell-off came a day after the US election gave Obama four more years in office, with some worries evident over the potential for more policy deadlock as the extremely austere “fiscal cliff” spending cuts and tax hikes loom.

“The enthusiasm over the outcome of the US election has quickly given way to a more sombre mood,” said Commerzbank analyst Carsten Fritsch. “Hopes that the ultra-expansionary monetary and fiscal policy would be continued have been replaced by fears that the forthcoming fiscal cliff negotiations could fail.”

The market was also hit Wednesday by new worries over the eurozone economy, including comments by the European Central Bank chief Mario Draghi. “Unemployment is deplorably high, overall economic activity is weak and it is expected to remain weak in the near term,” Draghi told a banking conference in Frankfurt on Wednesday.

The gloomy comments came ahead of Thursday’s interest rate announcement from the ECB, which is widely forecast to keep its key lending rate on hold at 0.75 percent.