A brutal new year selloff in oil markets deepened on Monday, with prices plunging more than 6 percent to new 12-year lows as further ructions in the Chinese stock market threatened to knock crude into the $20s. On Monday, China’s blue-chip stocks fell by another 5 percent and overnight interest rates for the yuan outside of China soared to nearly 40 percent, their highest since the launch of the offshore market.

Morgan Stanley warned that a further devaluation of the yuan could send oil prices spiraling lower still, extending the year’s nearly 15 percent slide.

While China’s ructions are spooking traders over the outlook for demand from the world’s No. 2 consumer, drillers in the United States say they are focused are keeping their wells running as long as possible, despite the slump, executives told a Goldman Sachs conference last week. FULL REPORT