Oil prices slipped more than $1 a barrel on Monday, after the world’s top producers delayed a meeting to discuss output cuts that could partly alleviate oversupply in global markets as the coronavirus pandemic pummels demand.
Brent crude slipped close to $30 a barrel in early trade and was at $32.82 by 0203 GMT, down $1.29, or 3.8%. West Texas Intermediat crude fell $1.66, or 5.9%, to $26.68 a barrel, after earlier touching a low of $25.28.
Late last week, prices surged, with U.S. and Brent contracts posting their largest ever weekly percentage gains due to hopes that OPEC and its allies would strike a deal to cut crude supply worldwide by at least 10 million barrels per day.
Prices on both sides of the Atlantic marked their worst month on record in March as the coronavirus pandemic crippled demand while a price war between Saudi Arabia and Russia left the market awash in supplies.
The producers were initially set to meet on Monday, but that has now been pushed to April 9, after they blamed each other for the collapse of talks in March.
It “just took a delay in the meeting between Saudi and Russia to knock the wind out of that rally”, said Michael McCarthy, chief strategist at CMC Global Markets in Sydney.
U.S. President Donald Trump said he would impose tariffs on crude imports if necessary to support U.S. oil sector.
The head of the International Energy Agency has said oil inventories would still rise by 15 million bpd in the second quarter even with output cuts of 10 million bpd.
He urged the world’s richest economies to discuss broader ways to stabilise oil markets.
The kingdom delayed the release until Friday to wait for the outcome of the meeting between OPEC and its allies regarding possible output cuts, a Saudi source told Reuters.
Oil prices could also firm as decades-low prices have already forced producers to cut output, experts said.