Oil prices plummeted to their lowest levels since the depths of the global recession in February 2009 as investors braced for a flood of Iranian oil in an already glutted market.
U.S. premium crude prices plunged nearly 6 percent to $37.65 in New York and Brent crude fell to $40.73 in London, dragging down global stock prices and the currencies of oil-producing countries like Russia and Iran.
Traders cited the OPEC oil cartel's failure last week to curb production despite Iran's vow to ratchet up its output next year to levels that prevailed before the West imposed economic sanctions on Tehran.
Organization of Petroleum Exporting Countries members currently are pumping oil at a record rate of 32 million barrels a day -- 2 million above their own target.
Iran hopes to increase its production by another 1 million barrels a day as Western economic sanctions are lifted under a July nuclear accord with world powers. That would only worsen the glut of crude in global markets.