REUTERS / Jim Urquhart
- Oil continued to plunge on Tuesday as the historic production cuts that OPEC agreed to over the weekend were overshadowed by the impact of the coronavirus pandemic on global demand.
- US West Texas Intermediate declined up to 11% to $ 19.96 a barrel and declined for the third consecutive day. Brent crude fell more than 7% to $ 29.39 a barrel to intraday lows.
- WTI closed 7.1%, while Brent ended the day 5.1% lower.
- Saudi Arabia said on Monday that it would be open for further production cuts in June if needed.
- Watch oil trading live on Markets Insider.
The oil slipped on Tuesday when crater demand due to the coronavirus pandemic outweighed OPEC's production cuts agreed over the weekend.
US West Texas Intermediate declined up to 11% to $ 19.96 a barrel and declined for the third consecutive day. The international benchmark Brent crude fell more than 7% to $ 29.39 a barrel at intraday lows. WTI closed 7.1%, while Brent ended the day 5.1% lower.
The sharp drop in oil consumption as airlines cut flights and urge consumers to stay home to curb the spread of COVID-19, the disease caused by the virus, has overshadowed OPEC's historic production cuts. At the weekend, the group agreed to cut production by 9.7 million barrels a day. This is the largest coordinated cut in production ever.
The cuts start in May and account for about a tenth of the world's oil production.
On Monday, Saudi Arabia said it would be open for further production cuts if necessary when the group and their allies meet in June. Still, it said it would only cut production if other members of the OPEC + Alliance also agreed to cuts, a longstanding policy of the Kingdom.
"We are still dealing with uncertainties surrounding the virus and its effects," Prince Abdulaziz bin Salman said during a conference call with reporters. "The will is there and the structure is there."
He also said that oil demand forecasts may be too pessimistic. In this case, OPEC + may not have to make any further cuts.
Oil prices fell up to 64% this year as the coronavirus pandemic slowed demand.
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