Oil falls below $89 as stock markets plunge

LONDON (Reuters) – Oil slid almost $2 to a six-week low below $89 a barrel on Monday, as stock markets plummeted and concerns mounted over an economic slow-down led by top consumer the United States.

Stock markets across the world took a battering as anxiety spread that a fiscal stimulus plan proposed by U.S. President George W. Bush last week would not be enough to prevent a recession.


U.S. crude fell by $1.65 to $88.92 by 7:55 a.m. EST in electronic trade, just off a session low of $88.67, which was the lowest level since December 11.

Oil has dropped by more than 10 percent from a record high of $100.09 hit on January 3.

Floor trading on the New York Mercantile Exchange (NYMEX) is shut on Monday for the Martin Luther King Jr. holiday.

London Brent crude was down $1.29 at $87.94.

“The economic slowdown is dominating sentiment today,” Tony Machacek at Bache Commodities said.

Reuters