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[CHART] How Today’s Crash in Commodity Prices Compares to 1999

This is a syndicated repost published with the permission of Money Morning - We Make Investing Profitable. To view original, click here. Opinions herein are not those of the Wall Street Examiner or Lee Adler. Reposting does not imply endorsement. The information presented is for educational or entertainment purposes and is not individual investment advice.

Commodity prices just hit their lowest level of the 21st century.

The Bloomberg Commodity Index, which tracks the movement of 22 raw materials and their underlying futures contracts, tumbled 1.5% to 86.96 points this morning (Monday). The index hasn’t sunk that low since Aug. 26, 1999, when it hit 86.30.

Here’s how the index has trended from 1999 to now:

commodity pricesThe index’s most heavily weighted components are natural gas, crude oil, and gold. Futures for these commodities have fallen 1.5%, 4.4%, and 0.5% since Friday.

“Sentiment is extremely negative across the commodity complex,” noted Mark Keenan, head of commodities research for Asia at Societe Generale SA in Singapore, in an e-mail toBloomberg. “Markets are plagued by concerns of oversupply.”

All commodity prices retreated today as investors panic over slowing demand in China. The world’s second-largest economy and leading consumer of energy, grains, and metals saw the benchmark Shanghai Composite Index plummet 8.5% on the day. That’s China’s worst single-day stock market loss since 2007.

The current commodity price crash marks the first significant slump since the peak of the 2008 financial crisis. The commodity index fell nearly 60% during the last half of 2008. Prices have slowly been declining since they hit a post-recession peak in early 2011.

But oil is dragging the index down the most. In fact, Brent oil prices cratered to their lowest levels in over six years this morning.

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