Oil prices declined significantly on Monday as market participants were worried that the continued spread of the coronavirus would further dent global demand for crude.
The West Texas Intermediate (WTI) for April delivery decreased 3.03 U.S. dollars to settle at 28.70 dollars a barrel on the New York Mercantile Exchange, while Brent crude for May delivery was down 3.80 dollars to close at 30.05 dollars a barrel on the London ICE Futures Exchange.
"The price response is understandable given that lower interest rates and new bond purchasing programmes will do nothing to combat the current weakness of oil demand," Carsten Fritsch, energy analyst at Commerzbank Research, said in a note Monday.
The more countries "freeze" public life, close their borders and cancel flights, the greater the impact will be on oil demand, especially as this also involves economic activity being generally scaled down, Fritsch added.
The oil market was also pressured by a looming supply glut.
Failure to strike a deal between the Organization of the Petroleum Exporting Countries and its allies, led by Russia, about oil production cuts, had sent oil prices into a nosedive and sparked fears of a possible price war.
Saudi Arabia, the United Arab Emirates and Russia have already announced a significant increase in oil production.
For the week ending March 13, WTI fell 23 percent, while Brent lost 25 percent. Both crude benchmarks notched their biggest weekly percentage declines, based on the front-month contracts, since December 2008, according to Dow Jones Market Data.
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