OIL PLUNGES 25% AS ANOTHER VIRUS-FUELED TRADING WEEK BEGINS

Oil prices are plunging amid worries that an OPEC dispute will lead an economy weakened by the coronavirus to be awash in an oversupply of crude.

Brent crude, the international standard, lost $11.44, or 25.3%, to $33.83 per barrel in electronic trading in London. Benchmark U.S. crude fell $10.77, or 26.1%, to $30.49.

The dramatic losses follow a 10.1% drop for U.S. oil on Friday, which was its biggest loss in more than five years. Prices are falling as Saudi Arabia, Russia and other oil-producing countries argue how much to cut production in order to prop up prices.

Demand is falling as people cut back on travel around the world. The worry is that the new coronavirus will slow economies sharply, meaning even less demand.

Stephen Innes, chief markets strategist at AxiCorp, called reports that Saudi Arabia could increase its oil production in order to gain market share a “shock-and-awe” strategy.

The U.S. stock market is down 12.2% since setting its record last month on worries about how much corporate profits will fall because of COVID-19.

Treasury yields have plummeted to record lows as investors pile into anything that looks safe, almost regardless of how little it pays. The 10-year Treasury yield pierced below 1% for the first time on Tuesday, only to breach 0.70% Friday.

The virus usually leaves people with only mild to moderate symptoms, but because it’s new, experts can’t say for sure how far it will ultimately spread and how much damage it will do, both to health and to the economy. There have been more than 100,000 cases worldwide.