The oil market has been under pressure due to a spate of reports on weak fuel consumption and grim forecasts from the Organization of the Petroleum Exporting Countries (OPEC) and the International Energy Agency. The volume of oil held in US storage, especially at Cushing, Oklahoma, the delivery point for the U.S. West Texas Intermediate (WTI) contract, is rising as refiners throttle back activity due to slumping demand. The front-month May WTI contract CLc1 was down $ 2.62, or 14 percent, to $ 15.65 a barrel by 0142GMT. At one point, the contract had fallen as much as 21 percent to hit a low of $ 14.47 a barrel, the lowest since March 1999.
FTSE 100 LIVE: Crude oil futures fell on Monday
That contract is expiring on Tuesday, and the June contract CLc2, which is becoming more actively traded, fell $ 1.28, or 5.1 percent, to $ 23.75 a barrel. Brent LCOc1 was also weaker, down 21 cents, or 0.8 percent, to $ 27.87 a barrel.
The plunge in crude oil prices reflects a glut at the main U.S. storage facilities at Cushing and a big drop in demand, said Michael McCarthy, chief market strategist at CMC Markets in Sydney.
“It hasn’t reach capacity but the fear is that it will,” he said, adding that once the maximum capacity is reached, producers will have to cut output.
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6.17am update: Japan exports slump as coronavirus hits US, Chinese demand
Japan’s exports slumped the most in nearly four years in March as US-bound shipments, including cars, fell at the fastest rate since 2011, highlighting the damage the coronavirus pandemic has inflicted on global trade.
Monday’s bleak data underscored the challenges Prime Minister Shinzo Abe’s government faces in dealing with a collapse in activity that is expected to send the global economy into its deepest slump since the Great Depression of the 1930s.
After a jump in virus cases, Abe expanded a state of emergency last week to include the entire country, which gave authorities more power to push people to stay home and businesses to close. Japan has reported more than 10,000 infections and over 200 deaths.
Adding to worries the world’s third-largest economy is sliding into recession, Ministry of Finance data showed Japanese exports fell 11.7 percent in the year to March, compared with a 10.1% decrease expected by economists in a Reuters poll.
That followed a 1 percent fall in February and marked the biggest decline since July 2016, as shipments to Japan’s major export destinations from China, the United States to Europe were all battered.