Crude oil prices started the new week on a lower note on Monday with coronavirus-related weak global oil demand and rising oversupply around the world.
International benchmark Brent crude was trading at $27.30 per barrel at 0624 GMT on Monday for a 2.77% decline after closing Friday at $28.08 a barrel.
American benchmark West Texas Intermediate (WTI) was at $23.66 a barrel at the same time for a 2.95% loss after ending the previous session at $24.38 per barrel.
The novel coronavirus (Covid-19) continues to keep global oil consumption weak, as transportation is limited due to large-scale quarantine measures worldwide. This is causing a further supply glut as oil producers continue pumping oil.
Saudi Arabia-led OPEC and Russia-led non-OPEC oil producing countries agreed on April 12 to lower their collective oil production by 9.7 million barrels per day to trim some of the oversupply in the global oil market.
However, the 23-nation group known as OPEC+ will cut their output starting from May 1 for a period of two months. However, based on this decision, it is yet unknown how much oil will be removed from the supply glut.
Oil storage levels have witnessed sharp increases over the past few weeks, leaving less room for available capacity, while many countries could easily run out of oil storage space next month, risking a further fall in crude prices.
By Ovunc Kutlu