Brent crude futures slumped by more than 25% on Tuesday 10.45 am Nigerian local time, closing below $20 a barrel.
There are concerns that even after COVID-19 containment measures ease in the coming days, the world is going to be flooded with a lot of crudes for some time to come.
The main challenge is that the greatest users of fuel are inactive (vehicles, airlines), not forgetting businesses and factories closed because of the pandemic caused by COVID-19.
Following the plunge in crude oil prices, Saudi and members of OPEC (Organization of the Petroleum Exporting Countries) are considering reducing their oil production as fast as they can, rather than waiting till May 1, 2020.
Meanwhile, President Trump said yesterday that his government was planning to limit incoming Saudi crude oil shipments to support America’s battered oil drilling industry.