LONDON (AFP) - Oil prices dipped Tuesday close to 17-month lows, erasing earlier gains despite a warning that the OPEC producers cartel could slash output further in a bid to shore up the market. Prices had tumbled Monday on widespread concern that a global economic slowdown would significantly weaken demand for energy, analysts said. New York's main contract, light sweet crude for December delivery eased nine cents to 63.13 dollars a barrel on Tuesday, after hitting 61.30 dollars on Monday " a level last seen in May 2007. Brent North Sea crude for Dec slid 35 cents to $61.06. On Monday, the contract hit $59.02, its lowest point since February 2007. The Organization of Petroleum Exporting Countries (OPEC) warned Tuesday that it could cut output again if prices keep falling despite an output reduction agreed at an emergency meeting in Vienna last week. OPEC, which produces 40pc of the world's crude, could hold a new emergency meeting before its next scheduled session in December, said OPEC Secretary General Abdalla Salem El-Badri. "We will have to wait and see how the market will react (but) if this problem continues then we will have another cut," he told reporters on the sidelines of an oil conference in London. "If the situation deteriorated to the point where we had to have another meeting before Algeria we will do that," he said, referring to the next scheduled OPEC meeting in Oran, Algeria, on Dec 17. The cartel decided last Friday to slash crude output by 1.5m barrels per day to 27.3m bpd starting in November, as it sought to protect its revenues. Despite that move, the market fell, with OPEC's decision to cut supply at a time of global financial turmoil seen as hurting already weak demand, dealers said. The price of crude oil has more than halved since striking record highs above 147 dollars in July on heightened supply concerns. El-Badri said Tuesday that a fair price for a barrel of oil would be "something in between" those record highs and current levels of around 60 dollars. Analysts at energy consultancy John Hall Associates said prices would likely head higher on speculation that OPEC could cut back production levels further. "Upward pressure may well stem from ... any reassessment of OPEC's decision last Friday to cut output," they wrote in a note to clients. "Indeed, if prices continue to fall further then it is not inconceivable that the group could meet ahead of its scheduled session in Oran and decide to cut output further." The market got some support on Tuesday as the US currency dipped against the European single currency. A weaker US unit means that dollar-priced commodities like oil become cheaper for buyers holding stronger currencies.