The Bloomberg Commodity Index fell again overnight to the lowest level zinc 1991.
Copper extended its losses, dropping a further 0.8% to $US4342 per tonne, while oil threatens to fall into the $20s.
IG market analyst Evan Lucas said oil prices were the biggest story in the market right now.
“I fully expect to see oil in the $20 a barrel handle. However, the uber-bears are now suggesting $10 a barrel is a real possibility.
“That would be a dire problem as it will bring the bankruptcy question to bare – there are several estimates that suggest prices under $30 a barrel would mean one third of US oil and gas plays would go broke in six months.”
Shares in Freeport McMoRan – which is primarily exposed to copper and oil – fell by as much as 18% in New York overnight, hitting a 15-year low.
Rio Tinto was the worst performer in London, down by nearly 2.7%.
Elsewhere, gold dropped to $1087.30 an ounce and iron ore fell to $41.19/t.
In good news, the ASX is set to open higher after a positive night for global equities.
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