Oil prices are plunging amid worries that an OPEC dispute will lead an economy weakened by COVID-19 to be awash in an oversupply of crude.
Brent crude, the international standard, lost $8.77, or 19.3 per cent, to $36.50, as of 7:23 p.m. Eastern time on Sunday after earlier touching its lowest price since early 2016. Benchmark U.S. crude fell $8.11 to $33.17.
The dramatic losses follow a 10.1 per cent drop for U.S. oil on Friday, which was its biggest loss in more than five years. Prices are falling as Saudi Arabia, Russia and other oil-producing countries argue how much to cut production in order to prop up prices.
Demand is falling as people cut back on travel around the world. The worry is that the new coronavirus will slow economies sharply, meaning even less demand.
It’s been a brutal and dizzying couple weeks for financial markets worldwide. The U.S. stock market is down 12.2 per cent since setting its record last month on worries about how much corporate profits will fall because of COVID-19.
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