Shares around the world have seen further falls, sparked by renewed fears over the health of the global economy.
In China, the authorities intervened again on the stock market to little effect. Shares in Shanghai fell 3.4%.
And expectations of a US interest rate rise dimmed after the Federal Reserve said the economy was not ready yet.
Oil prices dropped at first – adding to steep falls seen on Wednesday – but then recovered. The price of Brent crude was down 7 cents at 42.58€ a barrel while US crude was up 20 cents at 37.5€.
Markets have become increasingly nervous over prospects for the global economy, especially with signs that the Chinese economy is slowing.
The devaluation of China’s currency, the yuan, last week took many by surprise, and the Chinese stock market has continued to see big fluctuations despite efforts by Beijing to calm markets.
On Thursday, Chinese shares fell again, with the benchmark Shanghai Composite index closing 3.4% lower at 3,664.29.
On Wednesday, minutes from last month’s meeting of the US Federal Reserve flagged up China as a potential problem, saying that a “material slowdown” in the Chinese economy could affect the US economic outlook.
The US central bank’s meeting came before last week’s action by China to weaken its currency.
“The Chinese slowdown is hugely important for the global economy and we can see the impact of this slowly spreading across East Asia, the commodity producers and now reaching a wider set of countries,” Lord Turner, the former chairman of the Financial Services Authority, told the BBC.
“I think what is going on in the industrial sectors of the economy, they maybe actually in recession and the official figures that show there is 7% growth – I think they are simply not credible.”
The Federal Reserve’s key interest rate has been kept near zero since December 2008, although there has been speculation that the Fed will raise rates at its meeting in September.
The latest minutes from the Fed were seen as giving little direction as to whether a rate rise in September was on the cards.
They showed that most policymakers thought conditions for a US rate rise “were approaching”, but the economy was not ready yet.
There was also concern that inflation would remain weak because of the strong dollar and falling commodity prices, which act as a double depressant on imports.
Lord Turner said that a rise in US interest rates and the dollar would have a “large impact” on emerging markets, especially corporate borrowers, who have borrowed in dollars.
“I think as long as we only see a small increase in US interest rates that’s not too big an impact, but if there was a 1% or 2% increase over a short period of time, that would be a major shock to the world economy.”
Lord Turner said he did not believe there was a risk of another financial crisis similar to the one in 2008 because the banking system was more robust, but he feared there were unresolved imbalances in the global economy.
Although oil prices appeared to stabilise on Thursday, they had fallen sharply on Wednesday following the release of data showing that US oil stockpiles were higher than expected.
The price of oil has more than halved over the past year, due to a combination of increased supplies and slowing demand.
The low oil prices are creating pressures on economies that are dependent on oil revenues.
Among them is energy-rich Kazakhstan, the biggest economy of Central Asia, which has announced it is floating its currency, the Tenge.
As a result, the Tenge dropped by more than a third in one day.
Other emerging market currencies also came under pressure on Thursday, with the Turkish lira briefly touching a record low of 3.0 to the US dollar.