The plunge in oil prices accelerated Monday in line with the sell off in global financial markets, as investors remain shaken about prospects for global economic growth.
Light, sweet crude futures for delivery in October fell as low as $37.75 on Monday. It quickly moved back above $38, however, and was down $2.13, or 5.3%, to $38.33 a barrel in mid-morning trade.
October Brent crude on London’s ICE Futures exchange plunged $2.38, or 5.2%, to $43.13 a barrel, dropping below $45 for the first time since March 2009. It is now trading more than 55% below its one-year high of $103.19 reached in August last year.
The losses deepened as U.S. stocks plummeted at the open, with the Dow Jones Industrial Average plunging 1000 points in early trade.
Oil prices have been under pressure for several months due to oversupply concerns, but the slump has deepened in recent weeks on fears of a sharp slowdown in the Chinese economy and its impact on global markets, according to CBS-MarketWatch.
The recent devaluation of the yuan has added to those concerns, stoking speculation that the slowdown will dent imports of oil and commodities by the world’s second-largest economy.