It’s a bad time to be in the oil business.
Oil prices crashed more than 9% to their lowest level in nearly three years on Friday as major producing nations failed to agree on supply cuts aimed at addressing the collapse in global demand caused by the coronavirus outbreak.
The OPEC cartel led by Saudi Arabia on Thursday had proposed a two-pronged approach to its key ally Russia: extend existing production cuts of 2.1 million barrels through to the end of 2020; and make further cuts of 1.5 million barrels per day.
But Russia refused to back the plan at a meeting with OPEC in Vienna on Friday, leaving the future of its three-year alliance with the cartel in doubt and raising the prospect of a huge supply glut.
OPEC Secretary General Mohammed Barkindo, speaking to reporters after the meeting broke up, said there was no consensus to extend the policy of supply restraint beyond the end of March and OPEC would not act unilaterally. Discussions would continue, he added, but gave no further detail.