Global Stocks Fall as Oil Plunges
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U.S. and European equities are in a slump as oil prices trade near multi-year lows, dragged down by a glut in the global supply for the commodity.

U.S. crude for February delivery slid 6.7 percent on Wednesday to settle at $26.55 U.S. a barrel, while Brent futures for March delivery lost 2.7 percent to settle at $27.88 a barrel. These prices are the lowest since 2003.

U.S. economist Joseph Minarik attributes the recent nosedive to excessive investment that saw production expanded among major oil producers in recent years.

"Many of the producers, including in the United States, who have made investment in new oils, have loans against the investment in those wells, and they have to make the payments," Minarik said. "So in many instances when they would slow down or possibly even stop pumping oil from their wells, they have to continue to do so, because they need cash flow. So you have a number of producers who even at a lower price of oil, keep on pumping and keep on selling, and that makes the price even lower."

Minarik adds that the supply glut will keep oil prices low for the near future.

Meanwhile in China, the Ministry of Commerce says the plunge in oil prices dragged down the country's trade with Saudi Arabia and Iran last year.

The two Middle East countries are the top sources of crude oil for China.

In the first 11 months of 2015, China imported 46 million tons of crude oil from Saudi Arabia, 15 percent of total imports globally.

China imported 8 percent of the global total from Iran during the same time period.

Author： 　　　Source：CRI　　　 Editor：Yang Fan