Volatility

Markets Fall on Oil Woes

Crude drops to lowest level in four years.

The Dow fell sharply in the last hour of trading today, closing down 219 points. The price of oil also took a tumble, falling nearly $4 to $36.22, the lowest level in four years. The drop in oil prices followed the OPEC announcement yesterday that they would be instituting a record production cut. General Motors shares fell 16% after reports of a merger with Chrysler (which GM denied). Shares of General Electric also tumbled after S&P lowered its outlook to "negative", threatening its credit rating. The fact that no further progress was made on the auto bailout also contributed to market jitters, but oil was the key concern. "There's just too much oil on the market right now," said a BNP Paribas analyst. "I don't think anyone really expected the economy to go into this banner tailspin, and unfortunately, we're not done yet. The oil market is really trading on all the economic concerns more than anything else at this point."