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NEW YORK (CNNMoney.com) -- Oil prices fell back below $50 a barrel Monday, to its lowest level in more than 3-1/2 years, after OPEC said it would wait until its next scheduled meeting in mid-December to consider further production cuts designed to stabilize prices.

U.S. crude for January delivery fell $5.15 to settle at $49.28 a barrel. It is the lowest closing price since May 23, 2005, when it settled at $49.16

Monday's retreat brings the price of oil below the psychologically important $50 a barrel level. Crude last slipped below $50 more than a week ago.

The Organization of Petroleum Exporting Countries, a coalition of nations that produce about 40% of the world's oil, held an emergency meeting in Cairo this past weekend to discuss the global decline in demand that has driven crude prices down more than $95 a barrel from $147.27 on July 17.

"The price of oil is going to remain under pressure until they actually do that cut," said Michael Davies, head of research with Sucden (UK), Ltd. in London.

Many investors had expected the organization to announce some sort of production cut.

The organization had pledged to cut production by 1.5 million barrels a day at a previous emergency meeting in October. However, the cut was not enough to bolster prices, which have fallen more than 13% since then.

OPEC President Chakib Khelil said the group would wait until its scheduled meeting on Dec. 17 in Algeria to decide further actions on oil production levels.

Compliance: There is also some concern from oil investors about whether or not OPEC nations will stand by their decisions to cut production.

"That's always a factor with OPEC,"said Davies.

OPEC nations have been inconsistent in their compliance with the organization's production guidelines.

The group's secretary general, Abdalla Salem El-Badri, told reporters that OPEC nations have eliminated between 850,000 and 1.2 million barrels a day from the market out of the 1.5 million cut pledged in October, according to Dow Jones.

Ali al-Naimi, oil minister of Saudi Arabia, OPEC's largest producer, said this weekend that a second production cut might not be necessary if OPEC members achieved just 80% of the production cuts pledged in October, according to a Saudi-owned newspaper.

"If certain members of the cartel cheat on quota, I think its going to be difficult to push through another cut at the December meeting," said Phil Flynn, senior market analyst at Alaron Trading in Chicago.

Slowing demand: Meanwhile global demand for crude continues to slide as the economies of the world slow.

China's manufacturing activity in November slowed sharply, falling for the fourth month in a row, according an index compiled by brokerage CLSA Asia-Pacific Markets.

Rapid demand growth from China had been one of the factors that drove prices to their record highs in July.

"For us, China is the lynchpin in terms of oil demand," said Davies.

In the U.S., equity markets were also on the decline, with the Dow Jones industrial average losing more than 4% after November saw a large contraction of the nation's manufacturing activity and further decline in construction spending.

Investors worry that weakness in stocks could signal more problems with the U.S. economy, the world's largest oil consumer, according to Flynn.

The U.S. economy has officially been in recession since December 2007, the non-profit National Bureau of Economic Research declared Monday.