Oil prices fell by more than 30 percent on Monday, in the wake of the OPEC oil producers’ failure to agree on deeper production cuts amid the outbreak of the coronavirus, officially known as COVID-19.
After the talks failed, Saudi Arabia slashed the official selling price for its crude.
OPEC has had production cutting pacts since 2016 with its non-member allies, led by Russia. The wider alliance, known as OPEC+, met in Vienna on 7 March to discuss a potential cut of another 1.5 million barrels per day (bpd) above an existing pact to reduce production by as much as 2.2 million bpd from the start of 2020.
On 12 April, the Organisation of the Petroleum Exporting Countries (OPEC) and its allies agreed to reduce oil production by 9.7 million barrels per day in May and June, followed by 7.7 million per day for the second half of the year, and then by 5.8 million per day until April 2022.
As the coronavirus pandemic and the lockdowns caused by it continue to push global oil prices down to record lows, the start of oil production cuts negotiated by OPEC+ remains just about the only hope to halt falling prices.
On 20 April, the price of WTI crude futures for May delivery dropped to negative values for the first time in history, ending trade at minus $37.63 per barrel. The collapse was triggered by weak oil demand due to the COVID-19 pandemic and near-full oil storage facilities in the United States.
US crude prices went into the red for the first time in history on 20 April, closing down at minus $37.63 per barrel, with virtually zero buyers turning up for prompt delivery oil in a market woefully glutted.
As countries around the world have halted or limited production amid efforts to slow the spread of COVID-19, the pandemic is anticipated to shave 2.8 percent off the global economic output in 2020, Oxford Economics forecasting firm predicted, with the overall downturn to be more severe than the post-financial crisis 1.1 percent drop in 2009.
OPEC+ members along with several other oil exporting countries struck an agreement to reduce global crude output between 2020 and 2022 on 12 April after the price of black gold dropped to a nearly two-decade low.
On Sunday, OPEC and non-OPEC nations agreed on a new deal to slash oil production after weeks of instability on oil markets prompted by the coronavirus pandemic and internal disagreements in the organisation.
Even after members of OPEC+ and other oil-producing countries signed an agreement to cut global crude output, black gold prices have continued to fall, with Brent blend losing almost 7% since the deal was inked.
BRUSSELS (Sputnik) - The coronavirus pandemic looks set to shave off 2.8 percent from the global economic output this year, a UK-based forecasting firm has predicted in its monthly report.
WASHINGTON (Sputnik) - The Russian Embassy in Washington said it was "ridiculous" to blame Sputnik and RT for spreading fake information about the COVID-19 pandemic, adding that the US Defenсe Department should, instead, focus on fighting the infection in its own ranks.
In the words of Danish Radio expert Jakob Ussing, there is a fear in both the EU's two largest economies, Germany and France, and other European countries that important infrastructure and technology companies can end up in Chinese hands.
The deal was reached by global oil-producing countries on 12 April against the backdrop of a steep fall in oil prices, which since the end of February have lost $28 per barrel.
Following several days of negotiations OPEC and non-OPEC oil drilling countries have reached an agreement to limit crude production in several phases after prices fell by over $36 per barrel in the last two months due to the coronavirus pandemic and collapse of an old OPEC+ deal.
Saudi Arabia, a major strategic ally of the US, has been at the centre of an oil output cut dispute with Russia that unleashed a price war and sent already-volatile crude prices to their 18-year lows.
As the COVID-19 novel coronavirus continues to impede the American workforce, economists now predict the US’ response to the pandemic will lead to a 20% unemployment rate and a historic 40% plunge in the gross domestic product (GDP) for the second quarter of the year.
Amid lockdowns imposed by governments over the COVID-19 pandemic, with companies closing and dismissing staff, global economic growth will turn "sharply negative" this year, warns the International Monetary Fund. IMF Chief Kristalina Georgieva emphased that the world was headed for its worst economic crisis since the Great Depression of the 1930s.
Various economic forecasts predict a GDP fall of up to 16 percent as a result of the coronavirus outbreak and lockdowns which have been initiated to contain it.
As the EU bloc is readying measures to aid governments, companies and individuals survive the deep recession that the coronavirus pandemic is anticipated to trigger in Europe, talks between the 19 finance ministers of the eurozone on a coronavirus economic rescue plan failed Wednesday amid splits over conditions on financial aid.
Europe’s second-largest airline has grounded most of its fleet and is firing hundreds of workers to cover the costs inflicted by the coronavirus pandemic.
Oil prices fell on global markets in early March after OPEC+ members failed to agree on an extension to the agreement beyond 1 April against a backdrop of the coronavirus pandemic.