Oil prices falling off the cliff

NEW YORK, Aug. 24 (UPI) -- The steep drop in the Chinese stock market Monday pooled over to crude oil prices, pushing the U.S. benchmark to its lowest point in roughly six years.

The Shanghai Composite Index closed Monday down 8.49 percent to 3209.9 for its worst day since February 2007. Twin July crashes and an early August plunge sparked concerns about the health of the Chinese economy, thought to be among the strongest in the world.

Crude oil prices have been in a steep decline since June 2014, when prices hovered consistently about the $100 per barrel mark. Crude oil prices mirrored the plunge on the Shanghai, dropping to levels not seen at least since 2009.

Brent crude oil prices dropped more than 4 percent below the previous session to $43.47 per barrel. West Texas Intermediate passed another psychological threshold to start the trading day Monday down around 4.3 percent to $38.65 per barrel.

China's official Xinhua News Agency reports the decline in the Shanghai nearly wiped out gains for the year. That comes despite efforts by the Chinese government to reverse momentum with cash injections into the market and a devaluation of the national currency.

The Organization of Petroleum Exporting Countries in the past had said it needs to keep production steady to satisfy expected demand from Asian economies.

Wall Street opened in negative territory, with the Dow off about 4.5 percent at the opening of trading Monday. Global market trends suggest crude oil prices are reacting more to direct macroeconomic swings than the specific supply and demand dynamics pushing trajectory for most of the year.

Low crude oil prices have forced energy companies to spend less on exploration and production. Despite low rig numbers, production remains resilient, particularly in U.S. shale basin.

German financial services company Commerzbank said last week, however, that "U.S. shale oil production is barely profitable any more at current prices."