The Great Oil Crash of 2020 Has Arrived

The move has been widely reported as an overt bid to wrest market share away from Moscow after talks between Russian Federation and the Organization of the Petroleum Exporting Countries (OPEC) failed to agree on production cuts amid a coronavirus-driven collapse in oil demand. About a third of USA exploration and production companies need WTI prices of US$55 a barrel to break even, and with prices at their current levels - WTI was trading at about US$33.50 at 11 a.m.

Last week the Organization for Economic Cooperation and Development (OECD) said a severe outbreak of the coronavirus could see global growth down by 0.5 to 1.5 per cent. "With the oil-producing regions of our economy already stressed, this shock can only deepen", he added.

"China may slowly be returning to work, but manufacturers will now likely be facing an global fall in demand, with coronavirus now well-established outside of Chinese shores", added Mr Halley.

There were similar drops across Europe's other major indices, with the FTSE MiB in Italy - the epicentre of the continent's coronavirus outbreak - bearing the brunt of losses to close down 11.2pc.

The Fed, which made an emergency cut in interest rates last week, moved early Monday to increase short-term funding to support the US lending market. Russian Federation may have seen no point in cutting production only to lose market share as US shale producers in Texas and New Mexico take up the slack.

Chinese factories that make the world's smartphones, toys, and other consumer goods are gradually reopening but aren't expected to return to normal production until at least April.

Apple Inc. says slowdowns in manufacturing iPhones in China will hurt its sales totals.

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Huawei have been accelerating their development on the Huawei Mobile Services (HMS ) since losing its Android license in May 2019. Ahead of that launch, the company has quietly announced a Lite variant in the series called the Huawei P40 Lite .


"Many people criticised us, they said this is a kind of treasure chest, that the finance ministry is sitting on gold", Finance Minister Anton Siluanov said last week about the reserves.

The cost to the United Kingdom government to borrow over a two-year period briefly turned negative for the first time - meaning investors are forced to pay to own these bonds.

Already last week, global stocks were sinking as the spread of the virus prompted governments to follow China's lead by imposing travel controls and canceling public events. "Markets hate uncertainty and there is a ton of it now in play", said Greg McBride, CFA, chief financial analyst at Bankrate.com. "As the uncertainty persists, the market frenzy will continue, perhaps for weeks, perhaps for months". The yields on two and five-year gilts both entered negative territory shortly after the open, meaning investors were temporarily paying a fee to lend money to the Government.

Before today's price cut he said Wellington prices were 10 cents a litre lower than they were a week ago. The 30-year yield fell below 1% for the first time ever. But moves in stocks and bond yields were almost as breathtaking. Russian Federation turned the proposal down, causing the collapse of the alliance and the start of a price war over market share.

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"Global recession risks have risen", Moody's Investors Service said in a report.

This story was reported by The Associated Press.

  • Darren Santiago