NEW YORK (TheStreet) -- If investors had hoped stocks had absorbed most of the headwinds associated with lower oil prices, they were sorely disappointed on Wednesday as the commodity crash continued.
Crude prices struggled to remain above $60 a barrel with West Texas Intermediate tanking 5.1% to $60.54 a barrel after OPEC warned that demand for oil in 2015 could slow to its lowest point in 12 years. Just as oil futures stabilized midmorning, the commodity sank to new lows after the EIA reported a large increase in oil imports contributed to oversupply in domestic crude oil inventories for the week.
The energy sector was dragging on benchmark indices with the Dow Jones Industrial Average down 1.5%, or 266 points, and the S&P 500 falling 1.6%. It was the worst drop for both indices since early October. The Nasdaq slid 1.7%. The Volatility Index (VIX.X) spiked 24.2%.
No corner of the oil industry was unscathed by the selloff with the hardest hit including blue-chip oilers Exxon Mobil (XOM) , Chevron (CVX) and BP (BP) , as well as oil services companies such as Halliburton (HAL) , Baker Hughes (BHI) and Schlumberger (SLB) . The Energy Select Sector SPDR ETF (XLE) tanked 3.1%.