Oil prices tumbled more than 30% in the opening of weekly trading on Monday after the Kingdom of Saudi Arabia announced it will be increase production levels in the coming period after Russia refused to join the OPEC deal to deepen production cuts by 1.5 million bpd.
This has opened the oil markets to a gap seeking down levels of $32 a barrel before continuing to decline to levels of $27.60 to reach its lowest levels since February 2016 before OPEC headed to the agreement to cut production to support global prices.
What caused the markets panic OPEC and Russia feused to a new production reduction of 1.5 million bpd in an attempt to face the repercussions resulting from the outbreak of the Coronavirus on oil markets as one of the largest sectors affected with the decline in global demand and the halt of manufacturing industries in China and the decline in demand for aviation fuel . The Kingdom of Saudi Arabia intends to increase its production of crude oil to more than 10 million barrels.
