Oil Trades Near Four-Year Low as Virus Restrictions Tighten - Bloomberg

Oil Trades Near Four-Year Low as Virus Restrictions Tighten - Bloomberg:

Crude prices traded near a four-year low in the Asian morning as nations tighten restrictions to stem the spread of coronavirus.

Futures in New York edged up by 0.6%, after tumbling 9.6% on Monday. Leaders of the Group of Seven said they will do “whatever is necessary” to ensure a globally coordinated response to the coronavirus pandemic and its economic fallout. U.S. President Donald Trump markedly changed his tone on the outbreak and said Americans should avoid gathering in groups of more than 10 people, while Canada closed its borders to most foreigners. France said it may further tighten a national lockdown, while Germany partially closed its borders with five neighboring countries.

Oil plummeted Monday as a massive emergency move by the U.S. Federal Reserve to cushion the world’s biggest economy failed to quell the fear gripping markets, with the S&P 500 falling 12%. Forecasts for global oil use are being cut dramatically as government measures to contain the spread of the pandemic restrict the movement of people and throw supply chains into chaos.

At the same time, giant producers are unleashing a flood of supply after the disintegration of the OPEC+ alliance. Saudi Arabia is showing no sign of backing down in its price war with Russia, with the state oil company Aramco saying it’s “very comfortable” with oil prices below $30 a barrel.