By Christopher Johnson
LONDON (Reuters) - Brent crude oil fell to a four-year low below $80 a barrel on Thursday after Chinese data showed a further slowdown in activity in the world's biggest energy consumer and Saudi Arabia remained silent about a possible cut in production.
China's economy lost momentum in October, with factory growth dipping and investment growth hitting a near 13-year low, reinforcing expectations of a slower increase in fuel demand from the major emerging nations.
Developing economies have been a major support for oil over the last decade, but their fuel demand is now failing to keep up with increasing supply from North American shale production, which is eating into the traditional market for Middle East oil.
Brent crude for December, which expires on Thursday, fell 83 cents to $79.55, its lowest since September 2010, before recovering slightly to around $79.85 by 0900 GMT.
U.S. light crude was down 40 cents at $76.78 a barrel.
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"There are not many bullish factors," said Avtar Sandu, senior manager for commodities at Phillip Futures.
Demand for OPEC oil will drop to 29.20 million barrels per day (bpd) next year, almost 1 million bpd less than it currently produces, the cartel said this week.
Ministers from the Organization of the Petroleum Exporting Countries meet in Vienna on Nov. 27 to decide on oil production policy and how to respond to a 30 percent fall in oil prices over the last five months.
Some OPEC members have said they want the group to cut output. But OPEC's most powerful member, Saudi Arabia, has refrained from backing that view, prompting speculation it is more concerned with keeping market share than supporting prices.
In Mexico on Wednesday, Saudi Oil Minister Ali al-Naimi said the kingdom wanted stable oil prices but did not want to "politicise oil", which was "purely business":
"We do not set the oil price. The market sets the prices."
Carsten Fritsch, senior oil and commodities analyst at Commerzbank in Frankfurt, said some traders understood that comment to mean Saudi Arabia would let prices fall further.
"That is sort of benign neglect -- at least that is what the market thinks," Fritsch said, adding, "I think oil will test lower levels. A decisive fall below $80 for Brent is possible."
Energy Aspects analyst Amrita Sen said: "The silence from Saudi Arabia is very, very damaging because the market tends to interpret and lets its imagination go wild."
U.S. crude stocks fell by 1.5 million barrels last week to 373 million, compared with analysts' expectations of an increase of 800,000 barrels, data from industry group the American Petroleum Institute showed.
Weekly data from the U.S. Energy Information Administration (EIA) will be published at 11:00 a.m. EST (1600 GMT).
(Additional reporting by Jacob Gronholt-Pedersen in Singapore; Editing by Dale Hudson)