Oil prices slump 3% after Saudi Arabia and Russia delay talks to end their price war

• Crude oil prices slid more than 3% on Monday on reports that Russia and Saudi Arabia have postponed their oil production meeting to Thursday, casting doubt on a potential deal.
• Brent crude fell 3.1% to $33.10 and West Texas Intermediate fell 3% to $27.50, after surging last week on deal hopes.
• On Sunday, President Donald Trump threatened to impose "very substantial tariffs" on oil imports if Saudi Arabia and Russia do not reach a deal to end their price war.
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Global oil prices slid on Monday after Saudi Arabia and Russia postponed talks to cut output as the coronavirus pandemic continues to hammer demand.

Brent crude fell 3.1% to $33.10 in early trading, while West Texas Intermediate fell 3% to $27.50.

The Organization of the Petroleum Exporting Countries (OPEC) and its allies had scheduled a virtual meeting for Monday. The talks are now likely to take place on Thursday instead, CNBC said, citing sources familiar with the matter.

Since the last OPEC meeting, tensions between Saudi Arabia and Russia have escalated.

On Saturday, CNBC reported, Russian President Vladimir Putin blamed the oil-price collapse on Saudi Arabia pulling out of the more than 3-year-old OPEC+ deal. Saudi Arabian Foreign Minister Prince Faisal bin Farhan retorted that Putin's statement was completely "devoid of truth."

On Sunday, President Trump threatened substantial tariffs in order to protect US jobs.

"If they don't get along, I'd do tariffs," Trump said of the two oil-producing majors. "I would absolutely do that ... we will save tens of thousands of jobs."

Riyadh and Moscow are "very, very close" to an agreement on oil production cuts, Kirill Dmitriev, chief executive of the Russian Direct Investment Fund (RDIF), told CNBC.

Russia is also working with US authorities to include American producers in the output-cut agreement, the RDIF CEO said.

There's no shortage of volatility at the start of the week, Craig Erlam, senior market analyst at OANDA Europe, said in a morning note.

"Traders are shrugging off the Russia-Saudi spat over the weekend, turning a blind-eye to the apparent reluctance of the US to be part of any deal and completely ignoring the fact that today's emergency virtual meeting has been pushed back until at least Thursday," he said.

"The fact that the date for that latter decision has been pushed back from today to Thursday has seen energy slump in the Asian session - but also underlines the risk that the US (and Canada) will protect their own industries and workers regardless of what free-trade doctrine tells them to do," analysts at Rabobank said in a research note.

In March, oil prices plunged to record lows as the market waited for OPEC and its allies to strike a deal to prevent oversupply and stabilize production.

A price war between Saudi Arabia and Russia erupted after the two countries were unable to reach an agreement on production cuts. Global lockdowns and travel bans during the coronavirus pandemic have led to a drastic reduction in demand for oil as airlines cancel flights and people stay home.