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Brent and WTI fall to 6½-year lows on China jitters

Oil prices have dropped to 6½-year lows this morning: for the first time since March 2009, Brent costs less than $45 per barrel and WTI less than $40 per barrel. Losses since trading opened this morning amount to more than 3%, and there is no end in sight to the nose dive that oil prices have been experiencing for eight weeks now.

As far as today's price slide is concerned at least, fundamental data play only a subordinate role, as concerns about China are chiefly responsible this time. As a result, Iranian calls for an extraordinary OPEC meeting to halt the price slump are likely to fall on deaf ears, says Commerzbank. It is also impossible to say how long the price slump will continue and where oil prices will ultimately bottom out. Money managers are once again beating a hasty retreat from the oil market, thereby exacerbating the price slide. 

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