By Chris Hunter

Crude oil is getting shellacked. Today’s chart shows that U.S. crude oil prices are close to taking out their March lows.

070815 DRE WTI

China is the big worry.

As Bill has been warning, Greece is peanuts compared to what’s going on in China.

The Shanghai stock market is down 32% since its June 12 peak. The crash has wiped out the equivalent of about six times Greece’s GDP in under a month.

This is starting to look a lot like the tech wreck that crushed the Nasdaq in 2000. Following that wipeout, the U.S. went into recession.

With underlying economic growth in China faltering, government stimulus failing to keep the stock market rally alive, and the equivalent of trillions of dollars being wiped off investors’ portfolios, a Chinese recession is now a real possibility.

That could spell a long and nasty bear market ahead for growth sensitive commodities such as crude oil.