The collapse in crude-oil prices continued Tuesday, with the U.S. benchmark hitting its lowest level since June 2012. The sharp slide occurred after the International Energy Agency cut its forecast for oil demand growth to its weakest in five years.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in November fell $3.90, or 4.6%, to settle at $81.84 a barrel. That was oil’s lowest settlement since June 28, 2012. It was also the largest one-day percentage and dollar decline since November 2012. November Brent crude the global benchmark, dropped $3.85, or 4.3%, to end at $85.04 a barrel on London’s ICE Futures exchange. That was Brent’s lowest settlement since November 2010.

In its monthly report released Tuesday, the Paris-based IEA said it expects oil demand this year to rise by 700,000 barrels a day, down from its previous estimate of 900,000 barrels a day. At the same time, oil production rose by almost 910,000 barrels a day last month, according to IEA figures, boosted by rising production by the Organization of the Petroleum Exporting Countries, or OPEC, and non-OPEC producers alike. Market participants argued, however, the recent selloff is at or approaching overdone levels and has been much steeper than warranted by weak demand and supply fundamentals. “The large downward move in oil over the past two weeks was mostly speculative, in our view. While the market remains oversupplied and lower OPEC production should be required, we see few signs of new deterioration in fundamentals,” Morgan Stanley analyst Adam Longson said in a report.

Oil markets are looking to the OPEC meeting in November for cues on oil supply levels, and recent price cuts by OPEC oil producers have driven some of the speculation regarding production levels.