Brent oil prices fall to the lowest level since 2003 as the novel coronavirus has reduced worldwide consumption.
Around 1435 GMT, Brent for May delivery was down 7.33 % from Thursday, at $24.41 a barrel. West Texas Intermediate fell 5.97 percent to $21.25.
Crude oil rose even lower this month after a severe price war d between Saudi Arab and Moscow.
Analysts at the Wood Mackenzie research consultancy said, “The coronavirus pandemic is reducing oil demand.”
It was further stated, “The OPEC+ production restraint agreement fell apart on 6 March and Saudi Arabia is rapidly increasing supply. The result: Brent crude has plunged.”
Up till now, Russia and the Organization of the Petroleum Exporting Countries (OPEC) had cooperated closely since 2016 to curb production to support prices and secure their valuable revenues.
In this reference, the Sun Global Investments head Mihir Kapadia said, “With Saudi Arabia attempting to flood the oil market by ramping up production to counter Russia, oil prices have halved this month, prompting countries to stockpile under the low prices.”
“Oil stockpiles around the world climbed up as major refineries in core markets such as China were shut down due to the pandemic,” he added.
“According to industry reports, oil storage levels globally have already reached 75 % of capacity and continued stockpiling under closed demand would crash the prices to $10 in the coming months unless industrial activity restarts,” he informed.