Commodities prices plunged on Monday, with crude oil dropping to a seven-month low of $94 a barrel, as commodity dealers rushed to cut risk amid an acute crisis on Wall Street after Lehman Brothers filed for bankruptcy protection.

Gold was one of the few commodities to see gains, as investors rushed to the traditional safe haven as turmoil gripped financial markets.

Regulators on commodity exchanges took steps to limit the disruption to normal trading following the news that Lehman was seeking bankruptcy protection. Bankers said that banks were smoothly unwinding trades to which Lehman was counterparty, but cautioned that some corporate clients of Lehman could be left without their hedges.

The Commodity Futures Trading Commission, the US regulator, said it was "closely monitoring" markets after Lehman's collapse.

In a statement released late on Sunday, Walter Lukken, acting CFTC chairman, said the regulator was taking "steps to maintain the stability and orderliness of the commodity futures and options markets".

On Monday, the London Metal Exchange suspended Lehman Brothers from dealing on the LME's electronic Select trading system (which is anonymous). However, the LME has allowed Lehman to continue to deal in base metals via telephone.

Continued at Financial Times