Oil crashes after Saudi Arabia launches price war
Singapore: Oil plunged over 20 per cent Monday after top exporter Saudi Arabia launched a price war in response to a failure by leading producers to strike a deal to support energy markets.
The two main contracts both lost about a fifth of their value in morning Asian trade, with West Texas Intermediate sliding to about USD 32 a barrel and Brent crude to about USD 36 a barrel.
Saudi Arabia launched an all-out oil war Sunday with the biggest cut in its prices in the last 20 years, Bloomberg News reported, after a failure by cartel OPEC and its allies to clinch a deal to cut production.
A meeting of main producers was expected to agree to deeper cuts to counter the impact of the new coronavirus -- but Moscow refused to tighten supply.
In response, the Gulf powerhouse cut its price for April delivery by USD 4-6 a barrel to Asia and USD 7 to the United States, with Aramco selling its Arabian Light at an unprecedented USD 10.25 a barrel less than Brent to Europe, Bloomberg said.
Jeffrey Halley, senior market analyst at OANDA, said that "Saudi Arabia seems intent on punishing Russia.
"Oil prices... will likely be capped over the next few months as coronavirus stalls economic growth, and Saudi Arabia opens the pumps and offers huge discounts on its crude grades."
Global markets had already fallen heavily in recent weeks due to fears about the coronavirus, which has killed thousands and has spread around the world since emerging in China late last year.
Tokyo stocks were hit heavily hit at the open Monday on fears over the virus and the plunge in oil prices, with the dollar down against the yen.
Just after markets opened, crude prices briefly dropped as much as 30 per cent before gaining back some ground -- the biggest fall since the Gulf War in 1991, Bloomberg said.
The new developments are reminiscent of the oil price war that erupted in 2014 and sent oil prices crashing to less than USD 30 a barrel.
The price fall then battered revenues in the Gulf countries, forcing them to resort to austerity measures and borrowing to plug budget deficits.
On Sunday, shares in the energy-dependent Gulf plunged to multi-year lows after the failure to clinch a deal on production cuts, with all seven bourses in the region in the red.
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Man arrested with Rs 2.54-crore heroin in Mumbai
Mumbai (PTI): Police have arrested a man and seized over 500 grams of heroin worth Rs 2.54 crore in the illicit market from him in Mumbai, officials said on Friday.
The police's Anti-Narcotics Cell (ANC) made the drug seizure in Santacruz in the western suburbs. The operation was conducted by the Kandivali unit of the ANC on Thursday as part of a special crackdown against drug trafficking in the area, they said.
Acting on specific inputs, an ANC team conducted a raid in Santacruz (East) and intercepted a man. During a search, the team recovered 508 grams of high-grade heroin from his possession, an official said.
The seized contraband, a highly addictive, opioid drug derived from morphine, is estimated to be worth Rs 2.54 crore in the international market, he informed.
Following the seizure, a case was registered against the man under relevant sections of the Narcotic Drugs and Psychotropic Substances (NDPS) Act, 1985, and he was formally placed under arrest in the early hours of Friday.
The police are currently investigating the source of the drug and trying to identify the intended recipients of the consignment, he said.
