Coronavirus: Oil price collapses to lowest level for 18 years

Coronavirus: Oil price collapses to lowest level for 18 years

But analysts remained skeptical about the prospects of Putin agreeing to a new production pact while the Saudis remain determined to grow their output by a whopping 30% to 12.3 million barrels per day by end-April to wrest as much market share as possible from both Russian and US competitors. Instead, the kingdom pushed crude supply to record levels. The Saudis plan to boost oil exports to 10.6 million barrels per day (bpd) from May on lower domestic consumption. US shale manufacturing has upended worldwide oil markets lately, making the nation the international's main manufacturer. It is a culture that ensures a sustainable delivery of energy to the world.

Still, there has been some upside from the collapse in prices as China has increased US crude purchases, Reuters reported, with some buyers snapping up cargoes at the widest discounts ever as sellers seek to offload excess supplies in Asia.

"Diplomacy won't be able to help the physical oil market nor oil prices in the short term", Tonhaugen of Rystad said.

"Signs of policy discussions are multiplying and we believe such an outcome should no longer be dismissed", analysts at Goldman Sachs Group Inc. said in a note.

The price war has also hit shale oil producers in the USA, with Trump telling Tuesday's press conference that the production dispute threatened "thousands and thousands" of jobs.

The continent's producers such as Nigeria, Angola and Algeria can not compete with the lower costs of erstwhile allies Saudi Arabia and Russian Federation, who are flooding the market with oil.

The bearish mood in the market wasn't improved by a rift within the Organization of the Petroleum Exporting Countries (OPEC). The president added that he had "great" talks with both Putin and Crown Prince Mohammed bin Salman about the situation.

The global oil industry will be significantly transformed due to the "unparalleled demand destruction" this "apocalyptic" April will bring to the world, a number of experts from the energy industry told Bloomberg.

This was higher than analyst expectations of a 4-million-barrel increase and has raised concerns of an oversupply.

Saudi Arabia had said this month it had directed national oil company Aramco to keep supplying crude at a record rate of 12.3 million bpd in coming months and export more 10 million bpd from May. "We will see production shut-ins accelerate", Bordoff warned.

The agreement between the two countries was viewed as a necessary strategy in the face of the price wear between the former Soviet Union and Saudi Arabia.

Trump advised journalists Tuesday that Russian Federation and Saudi Arabia "are discussing" how to finish the price competition, including that he would imagine "joining at the appropriate time if need be". USA oil producers are struggling under a global collapse in prices.

They also agreed to have their top energy officials discuss slumping global oil markets.

Neither side detailed any steps they are considering to stem the downturn.

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