Oil down with focus on deeper OPEC cut amid coronavirus

Oil posts largest daily gains from previous trading session since September 2019

By Ovunc Kutlu

ANKARA (AA) - Crude oil prices were trading with slight losses on Tuesday after strong gains during the previous session as investors hope that OPEC will make deeper production cuts to mitigate the negative impact of coronavirus on global oil demand.

International benchmark Brent crude was trading at $52.55 per barrel at 0610 GMT for a 1.01% decline after its closed Monday at $53.09 a barrel with a 7.51% daily gain.

American benchmark West Texas Intermediate (WTI) was at $47.42 a barrel at the same time for a 1.04% loss after ending the session at $47.92 per barrel with a 7.42% daily surge.

With both benchmarks gaining over 7%, it marked their largest gains since Sept. 16, 2019, when drone attacks on Saudi Aramco culminated in supply risks from the world's largest oil exporter and pushed crude prices higher.

Last week, both benchmarks lost around 12%. While this was the largest weekly loss for Brent crude since January 2016, it was the biggest percentage fall for WTI since December 2008.

Coronavirus, which originated in China and quickly spread to the world, has heightened the risk of weak economic activity in Asia and low global oil demand while pushing prices lower.

OPEC and its allies will meet in Vienna, Austria on Thursday and Friday to discuss the outlook of the global oil market and take action against low demand by agreeing the extent of further production cuts.

While the group, dubbed as OPEC+, is estimated to make an additional cut of 600,000 barrels per day (bpd) in its output, some experts believe that the group could make deeper cuts than that to support prices.

OPEC+ has already implemented a production cut of 1.7 million bpd until the end of June 2020.


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