Oil plunged over $1 a barrel Monday after the world’s prime producers delayed a gathering to debate output cuts that could partly mitigate a supply glut in world markets as the coronavirus pandemic pummels demand.
Brent crude LCoc1 dropped close to $30 a barrel in early trade and was at $32.82, down $1.29, I.e., 3.8%. West Texas Intermediate crude CLc1 slumped $1.66, i.e., 5.9%, to $26.68 a barrel, after earlier touching a low of $25.28.
Late last week, prices soared, with U.S. and Brent contracts posting their largest ever weekly percentage gains attributable to hopes that OPEC and its allies would reach a deal to cut crude supply worldwide by at least 10 million barrels per day (bpd).
Prices on both sides of the Atlantic marked their worst month on record in March as the coronavirus pandemic dented demand while a price war between Saudi Arabia and Russia left the industry awash in supplies.
The producers had been initially set to meet Monday; however, that has now been pushed to April 9, after they blamed one another for the failure of talks in March.
The chief of the International Energy Agency has stated oil inventories would still surge by 15 million bpd in the second quarter even with production cuts of 10 million bpd.