2020 Russia–Saudi Arabia oil price war

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Flags of Russia (top) and Saudi Arabia

On 8 March 2020, Saudi Arabia began a price war with Russia, causing a major fall in the price of oil, with US oil prices falling by 34%, crude oil falling by 26%, and brent oil falling by 24%.[1]

The price war was caused by a breakup between the Organization of the Petroleum Exporting Countries and Russia over proposed oil production cuts due to the 2019–20 coronavirus pandemic. Oil prices had already fallen 30% since the start of the year due to a drop in demand.[2]

The fall in prices was one of the causes of the global stock market crash on 9 March 2020, which became known as Black Monday.

As demand continued to fall dramatically, oil prices went down further, reaching a 17-year low on 18 March where Brent was priced at $24.72 a barrel and WTI at $20.48 a barrel.[3]

On 30 March 2020, the price of Brent Crude fell 9% to $23 per barrel, the lowest level since November 2002.[4]

On 20 April 2020, Oil prices reached a record low, falling into negative values, due to the ongoing coronavirus pandemic and the Russia–Saudi Arabia oil price war.[5]

References[change | change source]

  1. Business, Matt Egan, CNN. "Oil crashes by most since 1991 as Saudi Arabia launches price war". CNN. Retrieved 2020-03-10.
  2. "Oil Prices, Stocks Plunge After Saudi Arabia Stuns World With Massive Discounts". NPR.org. Retrieved 2020-03-10.
  3. Sheppard, David; Raval, Anjli; Foy, Henry (18 March 2020). "Oil prices hit lowest level in 17 years as demand plunges". Financial Times. Retrieved 22 March 2020.
  4. Coronavirus: Oil costs hit 2002 low as markets digest surge in infections by James Sillars, Sky News, 30 March 2020
  5. "Oil prices fall to historic lows". The Guardian. 20 April 2020. Retrieved 20 April 2020.