Oil futures in New York fell by nearly 5% per barrel as investors cashed out their profits.
The slide was likely triggered by troubles in the banking sector.
"It would appear to be some large-scale bank liquidation -- not a specific bank but banks in general," said Addison Armstrong, director of market research for Tradition Energy.
Investors had piled into oil and other commodities this year as a hedge against inflation and the weak dollar, pushing crude up nearly 50 percent to over $147 a barrel this month.
Common sense suggests the move is a positive for the economy because lower oil should translate into lower prices at the pump. However not everyone sees it that way.
“I think oil is the great worry,” says Oppenheimer chief market technician Carter Worth on CNBC's Closing Bell. “If oil were to give back in a meaningful way it would kill the high flying energy sector yet it wouldn’t bring back a single job or bad mortgage or anything.”
Worth who's never one to mince words said in conclusion, “It’s just not good.”
And that leads to our Charles Schwab Question of the Day!