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Corona effect: Crude prices dip to 17 yr low

As coronavirus is ravaging the world, oil prices in Asia languished at 17-year lows on Monday. US benchmark West Texas Intermediate fell 5.3% to trade at $20 a barrel, while international benchmark Brent crude was off 6.5% at $23. The sharp dip came after the death toll from the pandemic surged past 30,000 at the weekend as cases in hard-hit Europe and the United States showed no sign of letting up.

Senior US scientist Anthony Fauci estimated the virus could possibly lead to 100,000 to 200,000 deaths in the United States. Taking note of the adversity, President Donald Trump extended “social distancing” guidelines until April 30.

Oil markets have been plunging for weeks as lockdowns and travel restrictions imposed by governments worldwide to fight the virus affect demand. Though the demand falls, supply has increased dramatically after top producers Saudi Arabia and Russia engage in a price war following a row about whether to cut output to support prices. No end seems to be in sight to a vicious price war.