"You're seeing traders continue the fear trade that demand will not be as great considering the recent large size sell-offs in the global market place and the recognition by central banks that this subprime issue is more than just a U.S. issue," said Zachary Oxman, senior trader at Wisdom Financial, in emailed comments.
"As long as we continue to see global volatility and until the banks and brokerages can assign a true value to the billions of dollars worth of subprime and CDO paper out in the market, you'll continue to see downside volatility in crude as each day brings more bad news to the markets," Oxman said. "Money seems to flow out of the crude complex to meet margin requirements and generally free up cash for other trading activities amongst other things."