Singapore — 0230 GMT: Crude futures were lower in mid-morning trade in Asia Monday as news of more and more countries going under lockdown weigh on the overall economic outlook.
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At 10:30 am Singapore time (0230 GMT), ICE Brent May crude futures were down $1.28/b (4.74%) from Friday's settle at $25.70/b, while the NYMEX May light sweet crude contract was 40 cents/b (1.7%) lower at $22.23/b.
Global coronavirus cases and deaths continued to trend higher and governments around the world have imposed stricter limits on travel and gatherings.
"Oil markets collapsed out of the gate this morning as prices react in tangent to stringent containment lockdown measure that has seen life come to a standstill around the world," AxiCorp's chief market strategist Stephen Innes said Monday.
"People are working or staying at home and only using their cars for the essential matters, as total demand devastation sets in," Innes added.
UAE's Emirates, the world's biggest long-haul airline, will suspend most passenger flights as of March 25 and operate mainly cargo, Platts reported.
The news followed announcements by several other international airlines, which have suspended or reduced activity because of the virus.
"Three weeks ago, we had expected Brent to find stabilization around the $30/b handle, but that support has since been steamrolled by increasing bearishness in global markets," OCBC analysts said Monday.
The outlook remains bearish amid concerns of an oil price war. Prices had taken a substantial hit two weeks ago, after Saudi Arabia slashed its crude selling prices for April.
Saudi Aramco has also pledged to supply 12.3 million b/d of crude in April and May amid a price war with Russia, following the collapse of the OPEC+ supply cuts that will expire at the end of March.
"Reports of talks between OPEC and the US shale industry did little to ease the selling in the crude oil market," ANZ analysts said Monday.
"The market saw little hope of any coordinated approach on supply... instead focused on growing the impact of lockdowns of major cities or countries on demand," they added.