Oil prices pull US stocks lower

US stocks tumbled Wednesday morning as the price of oil hovered around a 10-month high after surging yesterday on Saudi Arabia’s production cuts.

The Nasdaq was down 1.4% in the early afternoon, while the S&P 500 lost 1% and the Dow Jones Industrial Average fell 0.9%.

Oil futures jumped more than 2% yesterday when Saudi Arabia, one of the world’s largest producers and exporters of crude, said it was extending its voluntary production cut of 1 million barrels a day through December.

The cuts were first implemented in July and have been extended on a monthly basis ever since. The extension will continue to prop up oil and gas prices, upward pressure the U.S. government may have trouble controlling with strategic reserves at a 40-year low.

Stocks fell yesterday, pressured by the jump in oil prices and the effect it could have on consumer prices. The Dow Jones Industrial Average led markets lower, falling 0.6%. The S&P 500 lost 0.4% and the Nasdaq dipped 0.1%