Brent crude is trading at a four-month low following the International Energy Agency's (IEA) decision to boost oil supply last week.
Declines in metals and other commodity prices have caused global indices to report losses for Tuesday and Wednesday morning.
Asian markets rallied overnight after the Federal Reserve indicated it will not hike interest rates.
Global markets have marginally recovered after yesterday's surprise Standard & Poor's downgrade of the outlook for US debt caused widespread falls.
Oil major BP shares have dived this morning after its planned tie-up with Russian state-owned oil giant Rosneft was blocked by the courts.
Libya unrest has driven Brent crude oil to a 29-month high of $119, causing Asian markets to fall overnight and European stocks to slump as investors take profits.
Renewed inflation fears and worsening unemployment data in the US dampened markets across the pond and had a knock-on effect on the FTSE 100 before it closed today.
London's leading index started trading sluggishly, despite the Dow Jones yesterday closing up for the sixth consecutive day and the Nikkei hitting a nine-month peak overnight.
The FTSE 100 has opened slightly up, building on gains on Wall Street and positive employment news in the US.
The FTSE is slightly down in early trading, with RBS hit by fears it may be exposed to Ireland's economic problems.