Global oil prices slid on Monday after Saudi Arabia and Russia postponed talks to cut output as the coronavirus pandemic continues to hammer demand.
Brent crude fell 3.1% to $33.10 in early trading, while West Texas Intermediate fell 3% to $27.50.
A price war between Saudi Arabia and Russia erupted after the two countries were unable to reach an agreement on production cuts. Global lockdowns and travel bans during the coronavirus pandemic have led to a drastic reduction in demand for oil as airlines cancel flights and people stay home.
A virtual meeting which was scheduled for Monday between The Organization of the Petroleum Exporting Countries (OPEC) and its allies now stand postponed. The talks are likely to be scheduled till Thursday as per a report by CNBC.
As per the report by CNBC, Russian President Vladimir Putin blamed the oil-price collapse on Saudi Arabia pulling out of the more than 3-year-old OPEC+ deal. Saudi Arabian Foreign Minister Prince Faisal bin Farhan retorted that Putin's statement was completely "devoid of truth."
Riyadh and Moscow are "very, very close" to an agreement on oil production cuts, Kirill Dmitriev, chief executive of the Russian Direct Investment Fund (RDIF), told CNBC.
Russia is also working with US authorities to include American producers in the output-cut agreement, the RDIF CEO said.
"The fact that the date for that latter decision has been pushed back from today to Thursday has seen energy slump in the Asian session – but also underlines the risk that the US (and Canada) will protect their own industries and workers regardless of what free-trade doctrine tells them to do," analysts at Rabobank said in a research note.
In March, oil prices plunged to record lows as the market waited for OPEC and its allies to strike a deal to prevent oversupply and stabilize production.
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