Oil’s Shocking Crash Drags Prices Toward Worst Week Since 2008 - Bloomberg:
Oil is set to end its most dramatic week in recent memory with the biggest plunge since 2008, as major producers prepare to drench the market with supply just as the coronavirus crushes demand.
While futures fluctuated on Friday, prices are down about 24% this week. The crash was triggered by the collapse of talks between members of the OPEC+ group. Instead of reaching a deal to cut output to mitigate the fallout from the virus, producers led by Saudi Arabia and Russia embarked on a war for market share and pledged to pump more.
Crude has also been roiled by turmoil across global markets, with investors uncertain if efforts by policy makers worldwide will be enough to tackle the economic impact of the spreading corononavirus. Apart from battering economies who are dependent on energy revenue, oil’s collapse is also hitting U.S. shale producers by forcing them to cut spending and dividends.
The schism between Moscow and Riyadh is hardening with Russian oil producers planning to ramp up output next month, and no plans for a detente with Saudi Arabia. The kingdom said earlier in the week that it would boost output by more than 25% in April, while it sends a rush of crude to Europe, Russia’s traditional market.
Oil is set to end its most dramatic week in recent memory with the biggest plunge since 2008, as major producers prepare to drench the market with supply just as the coronavirus crushes demand.
While futures fluctuated on Friday, prices are down about 24% this week. The crash was triggered by the collapse of talks between members of the OPEC+ group. Instead of reaching a deal to cut output to mitigate the fallout from the virus, producers led by Saudi Arabia and Russia embarked on a war for market share and pledged to pump more.
Crude has also been roiled by turmoil across global markets, with investors uncertain if efforts by policy makers worldwide will be enough to tackle the economic impact of the spreading corononavirus. Apart from battering economies who are dependent on energy revenue, oil’s collapse is also hitting U.S. shale producers by forcing them to cut spending and dividends.
The schism between Moscow and Riyadh is hardening with Russian oil producers planning to ramp up output next month, and no plans for a detente with Saudi Arabia. The kingdom said earlier in the week that it would boost output by more than 25% in April, while it sends a rush of crude to Europe, Russia’s traditional market.
No comments:
Post a Comment