Stock Markets Plunge Across the World as Coronavirus Sparks Oil Price War

The industry suffered its worst crash since the 1991 Gulf War.

Bryan Smith/ZUMA

For indispensable reporting on the coronavirus crisis and more, subscribe to Mother Jones' newsletters.

Global stock markets, already reeling from intense panic over the spread of the novel coronavirus, plunged on Monday as oil prices nose-dived by more than 30 percent—the biggest daily drop since the Gulf War in 1991—after Saudi Arabia shocked the world by launching a price war against Russia. The drop comes as the number of confirmed cases of the virus reached nearly 110,000 worldwide.

Economists in the United States and Europe are now bracing for what could be the largest decline in the stock market since the 2008 global recession. Even before US markets opened, the S&P 500 on Sunday triggered a system to pause futures after contracts fell 5 percent. The first of three so-called “circuit breaker” levels, which kicks in after stocks fall 7 percent, went into effect on Monday, halting trading for 15 minutes.

CNBC with more on Monday’s dramatic fall-out:

Futures on the Dow Jones Industrial Average indicated an opening drop of more than 1,300 points. The S&P 500 futures indicated a 5% drop at Monday’s open. The S&P futures trading was briefly halted overnight. The sharp declines in the futures market signaled more turbulence ahead after a roller-coaster week that saw the S&P 500 swing up or down more than 2.5% for four days straight.

[…]

Saudi Arabia on Saturday slashed official crude selling prices for April, in a sudden U-turn from previous attempts to support the oil market as the coronavirus hammers global demand. The move came after OPEC talks collapsed Friday, prompting some strategists to see oil prices crater to $20 this year.

As outbreaks of the virus in Europe worsen, governments, including the United Kingdom and Germany, are considering enacting quarantines similar to the one Italy placed on 16 million people living in the country’s northern region, which includes the financial hub of Milan. The new lockdowns would likely seek to limit movement, prohibit large public gatherings such as sporting events, and close schools across regions.

Amid the free-fall Monday morning, President Trump, who has been known to politicize the performance of the stock market, focused on attacking Democrats and Barack Obama.

This post has been updated.

FACT:

Mother Jones was founded as a nonprofit in 1976 because we knew corporations and the wealthy wouldn't fund the type of hard-hitting journalism we set out to do.

Today, reader support makes up about two-thirds of our budget, allows us to dig deep on stories that matter, and lets us keep our reporting free for everyone. If you value what you get from Mother Jones, please join us with a tax-deductible donation today so we can keep on doing the type of journalism 2020 demands.

FACT:

Mother Jones was founded as a nonprofit in 1976 because we knew corporations and the wealthy wouldn't fund the type of hard-hitting journalism we set out to do.

Today, reader support makes up about two-thirds of our budget, allows us to dig deep on stories that matter, and lets us keep our reporting free for everyone. If you value what you get from Mother Jones, please join us with a tax-deductible donation today so we can keep on doing the type of journalism 2020 demands.

We Recommend

Latest

Sign up for our newsletters

Subscribe and we'll send Mother Jones straight to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate

We have a new comment system! We are now using Coral, from Vox Media, for comments on all new articles. We'd love your feedback.