Global oil prices fell to the lowest levels in more than four years Monday, pulling U.S. crude below the $30 mark, as investors continue to re-price energy demand amid an almost-certain worldwide recession amid the coronavirus pandemic.
The moves followed a wild overnight session for global stocks, which plunged to multi-year lows across the board following the Federal Reserve's emergency 1% rate cut, pledges from central banks in Japan, Australia and New Zealand to either lower rates, purchase assets or inject liquidity, and the largest declines on record for industrial output and retail sales in China following a near-national shutdown of its manufacturing sector last month.
"Based on the prices of oil, I've instructed the Secretary of Energy to purchase, at a very good price, large quantities of crude oil for storage in the U.S. strategic reserve," Trump told reporters at the White House Friday. "We're going to fill it right up to the top."
U.S. crude prices, meanwhile, failed to find a floor despite President Donald Trump's announcement Friday that the Energy Department would buy oil on the open market to add to the nation's Strategic Petroleum Reserve.
Brent crude futures contracts for May delivery, the global benchmark, were last seen $3.78 or 11.17%, lower from their Friday close in New York and trading at $30.07 per barrel in early European trading, a move that marks a 57% decline from its January 8 peak.
WTI contracts for April delivery, which are more tightly-linked to gasoline prices, were marked $2.81, or 8.9%, lower at $29.92 per barrel, which is also around 57% lower from its early January top.
Prices also continue to fall following Saudi Arabia pledge to substantially increase its daily crude output amid its escalating price war with Russia as the two sides battle to win market share following the collapse of an OPEC production cut agreement earlier this month.
Saudi Aramco officials in Riyadh said crude output would rise by more than 26% next month, to 12.3 million barrels per day, following the collapse of a three-year agreement between OPEC members and non-cartel allies, such as Russia, that had previously capped production at 9.7 million barrels per day.
The U.S. Energy Information Administration sees domestic output rising to 13.2 million barrels per day this year, and 13.6 million in 2021, as shale production continues to keep support American drillers.