Stock Market Crash-Oil Price Crashes 30%, Central Bank Meetings, Economic Stimulus Key Democrats reacted to President Donald Trump’s proposal to include a payroll tax cut as part of his plan to respond to the coronavirus. Senior Republicans also held back from endorsing the suggestion ahead of a key lunch meeting on Tuesday.
Senate Minority Leader Chuck Schumer attacked Trump for talking about “another tax cut” and urged the president to focus on efforts to contain the virus itself, such as paid sick leave for affected workers.
Boeing plunged 10% after it said it plans to draw down all of a $13.8 billion loan.
Britain announced a $39 billion stimulus package, hours after the Bank of England cut interest rates. German Chancellor Angela Merkel pledged to do “whatever is necessary,” and the European Central Bank’s president warned of a significant shock.
U.S. Treasury considers extending tax deadline
Fed faces debate on whether and how quickly to cut rates to zero
The battle for control of the global oil market intensified again on Wednesday as Saudi Arabia promised to increase production capacity and the United Arab Emirates said it plans to pump as much as possible next month.
Riyadh said it will boost capacity to an unprecedented 13 million barrels a day, doubling down on Tuesday’s pledge of extra output in April. The U.A.E., a close Saudi ally, then promised to push more crude to customers than it normally produces. These are fresh shots in an all-out war that has seen prices crash and the outlook for the market darken as nations prepare to pump as much as they can.
hy are oil prices crashing?
Saudi Arabia, the world's top exporter, launched a price war over the weekend. The move followed the implosion of an alliance between the OPEC cartel, led by Saudi Arabia, and Russia.
The kingdom and Russia came together to form the so-called OPEC+ alliance in 2016 after oil prices plunged to $30 a barrel. Since then, the two leading exporters have orchestrated supply cuts of 2.1 million barrels per day. Saudi Arabia wanted to increase that number to 3.6 million barrels through 2020 to take account of weaker consumption.
But Russian President Vladimir Putin, worried about ceding too much ground to American oil producers, refused to go along with the plan and his energy minister, Alexander Novak on Friday signaled a fierce battle to come for market share when he said countries could produce as much as they please from April 1.
Why did Saudi launch a price war?
Simmering differences over how best to manage global oil markets spilled into the open at a meeting between OPEC and Russia in Vienna on Friday. After Russia said it was ditching the alliance, Saudi Arabia warned it would live to regret the decision.
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