Disagreements between Saudi Arabia and Russia are pushing cryptocurrencies price down thanks to coronavirus
Yesterday was one of the worst days for the market in years. The ongoing coronavirus and panic during the epidemic is causing further damage. This time, cryptocurrencies price could not hold on. Oil price, which is also weakened by the beginning of the “price war” between Saudi Arabia and Russia, counts on significant losses.
Brent has fallen by 31% because of disagreements between Saudi Arabia and Russia
The price of oil has seen the most significant decline since the Gulf War in 1991. Overall, Brent oil has fallen by 31% not only due to coronavirus. The disagreements between Saudi Arabia and Russia, and also other oil miners, does not help too. Russia has refused to reduce oil production further.
Saudi Arabia is trying to reduce the price of oil. By increasing their production to record 12 million barrels a day, it force Russia to negotiate. Besides, Riyadh has reduced the cost of its oil to convince foreign buyers to buy. Cryptocurrency prices have changed significantly.
According to experts, this price war comes at the worst possible moment. Mainly because of the negative impact of coronavirus on the economy and financial markets. Recent forecasts assume that the demand will be the lowest in history during this quarter. The total daily oil consumption will decrease from 99.8 million barrels to 96 million barrels from January to March.
Saudi Arabia can hurt itself more than Russia
Saudi Arabia, however, could burn itself much more than Russia. This is not so much dependent on oil revenues, nor does it have a limited supply to China. It has signed a contract to supply oil to Chinese reservoirs somehow unaffected by a coronavirus.
On the contrary, disagreements between Russia and Saudi Arabia can have a positive impact on the economy. Since then, fuel prices has fallen to $0.99 per liter.
Coronavirus has already attacked cryptocurrencies price
Coronavirus panic on the market do not shy away from cryptocurrencies, which Bitcoin felt most today. He lost about 10% over the weekend and Monday and is currently holding around $7,900. During the weekend and Monday, the price dropped to 7748 USD.
This is due to the fear of investors, which is also illustrated by the Fear & Greed index. Currently, it is in the scale of level 17, representing an extreme concern on the investors. They are afraid about the spread of coronavirus and its impact on the financial markets. 2018 was the last time the Fear & Greed index got to that level.
Also, in connection with Bitcoin, one of the most searched keywords on Google is currently ‘coronavirus bitcoin’. However, other altcoins have also been avoided. For example, cryptocurrencies prices, Ethereum (ETH) lost over 13%, Bitcoin Cash (BCH) over 17%, and Ripple (XRP) over 12%.
Right here you can find updated information about the Oil price: https://www.investing.com/commodities/crude-oil