Oil plunged to its lowest price of the year Monday, another sign that the U.S. economy is in trouble and that demand for oil and gas could fall.
The slide followed Friday's announcement that ratings agency Standard & Poor's no longer considered U.S. government debt one of safest investments in the world.
Investors poured money into assets considered to be safer during times of economic uncertainty, such as Treasurys and gold, and pulled it out of stocks and oil Monday.
Benchmark West Texas Intermediate fell $5.57, or 6.4 percent to settle at $81.31 per barrel on the New York Mercantile Exchange on Monday. That is the lowest settlement price of the year for crude.
In the past two weeks, oil prices have dropped nearly $16 per barrel. Analysts think oil will remain volatile this week as traders look for some clarity on where the economy and demand are headed. Today, the U.S. government and OPEC will both issue an updated forecast for global oil consumption.
Oil is still higher than the $71.63 per barrel low of the past 12 months. Oil hit that Aug. 24 of last year, when a combination of disappointing economic news and abundant supplies drove down prices.
Gasoline futures, meanwhile, have fallen between 35 cents and 40 cents in the last two weeks. That will translate into a savings at the pump of about $140 million to $160 million a day for motorists, according to Cameron Hanover energy consultancy.
The national average price for retail gas was $3.663 a gallon Monday, according to AAA.
In the Buffalo Niagara region, a gallon of regular averaged $3.85 Monday, down 2 cents from a week ago.