Oil prices have slipped after major producers Saudi Arabia and Russia delayed a meeting to discuss output cuts.
The meeting is aimed at partly reducing global oversupply as the coronavirus (Covid-19) pandemic suppresses demand.
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According to Reuters, Brent crude futures fell by $1.23, or 3.6%, to $32.88 a barrel at 1012 UTC. In the previous session, the value slipped close to $30 a barrel.
Meanwhile, US crude CLc1 was down by $1.01, or 3.6%, at $27.33 a barrel. This followed a session low of $25.28.
Prices rose last week, as US and Brent contracts posted their largest ever weekly gains. This followed hopes of OPEC and its allies entering a supply cuts deal to cut crude by at least ten million barrels per day (Mbpd).
Saudi Arabia and Russia were supposed to meet today to discuss the output cuts. It has now been postponed to 9 April.
Russia’s sovereign wealth fund chief told CNBC that the countries are ‘very, very close’ to supply cuts deal.
Meanwhile, US President Donald Trump has said he will tax crude imports if he had to ‘protect’ US energy workers from the oil price crash.
International Energy Agency (IEA) head Fatih Birol said that oil inventories would still rise by more than 15Mbpd in the second quarter this year.
Referring to the US shale producers, CMC Global Markets Sydney chief strategist Michael McCarthy said: “In the short term, the low prices are very painful, but if it does lead to a lot of those players leaving the industry, the supply side of the equation will balance out.”
