Oil slumps on worries that supply cuts are playing catch-up to falling demand - Reuters

Oil slumps on worries that supply cuts are playing catch-up to falling demand - Reuters:

Oil prices dropped sharply on Tuesday, with U.S. prices sliding back toward $20 a barrel, as investors bet that fuel demand destruction caused by the coronavirus pandemic would be too much for producers embarking on record global output cuts to offset.

Global oil-producing nations are expected to reduce production by as much as 19.5 million barrels per day, but those cuts are being implemented slowly and in some cases will not start for weeks. By contrast, demand plunged by roughly 30% worldwide several weeks ago, causing refiners and producers suddenly stuck with oil to stick it into rapidly filling storage.

U.S. West Texas Intermediate (WTI) crude CLc1 settled at $20.11 a barrel, down $2.30 or 10.3%, as one prominent pipeline executive told Texas regulators that storage would be filled by mid-May.

WTI is not far from where markets traded prior to a rally founded on hopes for the OPEC+ production deal inked over the weekend.

Brent crude futures LCOc1 fell $2.14, or 6.7%, to settle at $29.60 a barrel.

Both benchmarks are down more than 50% down this year.