Oil Price Drops to $28 as Supply Cuts Not Enough

OE Staff
Wednesday, April 15, 2020

Oil fell 5% to around $28 a barrel on Wednesday, pressured by reports suggesting persistent oversupply and collapsing demand due to global coronavirus-related lockdowns.

The International Energy Agency (IEA) on Wednesday forecast a 29 million barrel per day (bpd) dive in April oil demand to levels not seen in 25 years and said no output cut could fully offset the near-term falls facing the market.

Brent crude fell $1.49, or 5%, to $28.11 a barrel as of 0827 GMT, giving up an earlier gain. U.S. West Texas Intermediate crude slid 51 cents, or 2.5%, to $19.60.

"There is no feasible agreement that could cut supply by enough to offset such near-term demand losses," the IEA said in its monthly report. "However, the past week's achievements are a solid start."



The Organization of the Petroleum Exporting Countries, along with Russia and other producing countries - a grouping known as OPEC+ - has partnered with other oil-pumping nations like the United States for a record supply-cutting agreement.

The IEA report added to downward pressure caused by rising inventories.

Industry group the American Petroleum Institute said on Tuesday that U.S. crude inventories rose by 13.1 million barrels, more than analysts expected. Official government inventory figures are due later on Wednesday. 

(Additional reporting by Yuka Obayashi; Editing by Alexander Smith)

Categories: Energy Russia Activity Oil Production Saudi Arabia Oil Price

Related Stories

Oil and Gas Majors Start Next Phase of Pioneering OD OBN Project

Nexans Opens Newly Expanded Subsea Cable Facility in Norway

North Star Eyes 40 Hybrid SOVs by 2040 with New Funding in Its Pockets

Current News

Philippines Files UN Claim to Extended Continental Shelf in South China Sea

Oil and Gas Majors Start Next Phase of Pioneering OD OBN Project

Maersk Gets Vestas' Powertrains Heavy Lift Job

CDWE to Install Foundations on CIP’s 500 MW Offshore Wind Farm in Taiwan

Subscribe for OE Digital E‑News