Crude oil benchmarks slumped at the open of electronic trading on Sunday, extending last week’s losses as the global coronavirus pandemic worsened and the Saudi Arabia-Russia price war continued unabated, APA reports quoting Reuters.
In early trading, Brent futures fell 7.1% to $23.15 a barrel as of 6:13 p.m. EDT (2213 GMT), while U.S. crude futures lost 5.6%, or $1.17, to $20.34 a barrel.
The oil markets are enduring a twin shock of demand destruction caused by the coronavirus pandemic and the Saudi-Russia price war that is flooding markets with extra supply.
The coronavirus pandemic has already killed about 32,000 people and sickened more than 500,000 worldwide. On Sunday, Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, estimated the United States alone could suffer as many as 200,000 deaths.
The virus has brought the worldwide aviation industry to a standstill and put roughly 3 billion people on lockdown to limit the spread of the virus. With many eschewing daily automotive use, analysts have estimated worldwide fuel demand could fall by as much as 20% in the coming month.
Despite this, Saudi Arabia and Russia remain at loggerheads. Russian oil companies have said they expect the price war to continue, while the Saudis have not given any indication that there are new talks coming to curb supply.