With crude sliding through the key $60 level, oil pressure could stay on stocks Friday.
Stock futures traded sharply lower early Friday prior to the open, following sharp declines in global markets.
West Texas Intermediate futures for January closed at $59.95 per barrel, the first sub-$60 settle since July 2009. The $60 level, however, opens the door to the much bigger, $50-per-barrel level.
Besides oil, traders will be watching the producer price index Friday morning, and it's expected to be off 0.1 percent with the fall in energy. Consumer sentiment is also expected at 10 a.m. EST.
Consumers stepped up and spent in November, as evidenced in the 0.7 percent gain in that month's retail sales Thursday. That better mood should show up in consumer sentiment.
Stocks on Thursday gave up sizeable gains after oil reversed course and fell through $60. Traders also were nervously watching the progress of a spending bill in Washington, which was delayed.
(Click here for the latest on House spending bill: Will the 'CRomnibus' pass?)
The Dow was up 63 at 17,596, wiping out much of a 225-point intraday gain.
"Oil has pretty much spooked people," said Daniel Greenhaus, chief global strategist at BTIG. "There just isn't a bid. With everything in energy and the oil price collapsing as it is, who is going to step in and be a buyer now? The answer is nobody."
Oil continued to slide in after-hours trading. "The selling appears to have accelerated a little bit after the close with really no bullish news in sight," said Andrew Lipow, president of Lipow Associates. WTI futures temporarily fell below $59 in late trading.
"The big level is going to be $50 now in terms of psychological support. Much as $100 is on the upside," said John Kilduff of Again Capital.
Oil stands a good chance of getting there too. Tom Kloza, founder and analyst at Oil Price Information Service, said the market could bottom for the winter in about 30 days, but then it will be up to whatever OPEC does. The cartel in November voted to keep its production unchanged in an effort to hold market share.
Read MoreSchwarzman: Energy a 'wonderful' opportunity
"It's (oil) actually much weaker than the futures markets indicate. This is true for crude oil, and it's true for gasoline. There's a little bit of a desperation in the crude market," said Kloza. "The Canadian crude, if you go into the oil sands, is in the $30s, and you talk about Western Canadian Select heavy crude upgrade that comes out of Canada, it's at $41/$42 a barrel. Bakken is probably about $54."
Kloza said some there's talk that Venezuelan heavy crude is seeing prices $20 to $22 less than Brent, the international benchmark. Brent futures were at $63.20 per barrel late Thursday.
Read MoreOil price drop blamed on US supply
"In the actual physical market, it's fallen by even more than the futures market. That's a telling sign, and it's telling me that this isn't over yet. This isn't the bottoming process. The physical market turns before the futures," he said.
As for consumers, Kloza said gasoline should fall below $2 in about a dozen states in the near future, as the national average heads toward $2.50 per barrel. According to AAA, the national average Thursday was $2.62 per gallon on regular gasoline. That compares with $2.72 a week ago and $3.25 a year ago.