Globally, crude prices suffered yesterday, Monday, from the largest daily decline since 1991, with a number of major oil producers in the world a price war threatening to flood the global oil markets with supply
The drop in about 25% in oil prices has led to panic-led sales and sharp losses of major US stock indexes, as fears of a global recession worsen in light of the rapid spread of the emerging corona virus (Covid – 19).
Both Saudi Arabia and Russia said they would increase production early next week after last Friday’s three-year agreement that collapsed between them and other major oil producers to curb supply.
Moscow has refused to support the Organization of Petroleum Exporting Countries (OPEC) in deepening oil production cuts to cope with the significant decline in demand caused by the impact of the Coruna virus on travel and economic activity.
Brent crude futures fell $ 10.91, or 24.1%, to settle the settlement price at $ 34.36 a barrel, while US West Texas Intermediate crude oil fell $ 10.15, or 24.6%, to close at $ 31.13 a barrel.
Oil prices rose 8% today, Tuesday, to recover from the largest loss recorded in one day in nearly 30 years, while investors are looking for a possible economic stimulus in light of the price war between Russia and Saudi Arabia and the slowdown in new cases of coronavirus in China.