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UPDATE 2-Oil plunges over 20% after Saudi Arabia slashes prices on OPEC deal collapse

Published 03/09/2020, 06:57 AM
Updated 03/09/2020, 07:00 AM
© Reuters. UPDATE 2-Oil plunges over 20% after Saudi Arabia slashes prices on OPEC deal collapse
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(Adds latest prices, background)
March 8 (Reuters) - Oil futures suffered their biggest daily
loss since 1991 on Sunday after Saudi Arabia slashed its
official selling price (OSP) and announced plans to raise crude
production significantly, signaling the start of a price war.
Those moves came after Russia on Friday balked at OPEC's
proposed steep production cuts to stabilize prices hit by
economic fallout from the coronavirus.
Saudi Arabia said it plans to boost crude output above 10
million barrels per day (bpd) in April after the current deal to
curb production between OPEC and Russia - known as OPEC+ -
expires at the end of March, two sources told Reuters on Sunday.
Saudi Arabia cut its OSP for April for all crude grades to
all destinations by anywhere from $6 to $8 a barrel, sending oil
into a tailspin.
Brent LCOc1 futures fell $9.95, or 22.0%, to $35.32 a
barrel by 6:34 p.m. EDT (2234 GMT), while U.S. West Texas
Intermediate (WTI) crude CLc1 fell $8.99, or 21.8%, to $32.29.
Earlier in the session, both contracts fell to their lowest
since February 2016, with Brent down to $31.02 per barrel and
WTI at $30.
That puts Brent and WTI on track for their second biggest
daily percentage drops in history behind declines for both in
January 1991 over 30%.

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