Oil drops $4 on financial turmoil, Ike

By Matthew Robinson
Mon Sep 15, 1:04 PM ET

Oil plunged $4 on Monday as investors fled to safer havens due to turmoil in the U.S. financial system and on early signs Hurricane Ike had spared key U.S. energy infrastructure.

Lehman Brothers' (LEH.N) filing for bankruptcy protection and Bank of America's (BAC.N) agreement to buy Merrill Lynch (MER.N) stirred concerns that mounting global economic problems would slow energy demand further, sending investors out of oil.

U.S. crude dropped $4.36 to $96.82 barrel at 12:30 p.m. EDT, after hitting a seven-month low of $94.13 earlier, extending a 34 percent slide from peaks in mid-July amid mounting evidence of slowing fuel demand.