Oil is getting obliterated

Any hopes that oil prices will return to the triple-digit highs of 2014 were just killed off.

Oil prices are being annihilated on Monday after several oil producers, responsible for almost half of the world’s output, failed to reach a production-freeze agreement at a meeting in Doha on Sunday.

An agreement could have helped lift oil prices because there is too much oil on the market and too little demand.

Crude oil tanked by nearly 5% early Monday morning.

The international benchmark of oil prices — Brent oil — also tumbled by over 4%. However this is a slight recovery from earlier readings where prices crashed by around 7% immediately following the lack of a deal:

Oil prices are likely to remain under pressure for some time.

My colleague Greg McKenna said that t
he lack of a deal puts that rally under pressure and leaves traders with no clear guide to when the widening gap between oil supply and demand will be closed.

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