Gulf stocks nosedive after oil prices crash
Stock markets in the Gulf region nosedived at the start of trading Monday after oil prices crashed amid a price war after oil producers failed to reach agreement.
The Saudi stock market, the largest in the region, tumbled 9.2 percent at the start of trading Monday with energy giant Saudi Aramco diving 10 percent, well below its listing price.
The drop comes following a crash in oil prices on the global market after OPEC and its allies failed to reach a deal on production cuts to shore up prices dented by the coronavirus.
Kuwait's Premier index tumbled 9.5 percent and trading was temporarily suspended, while the All-Shares Index lost 8.7 percent.
Dubai Financial Market dropped 9.0 percent to its worst level in seven years but authorities suspended trading in most leading stocks after slumping the maximum daily limit of 10 percent.
Abu Dhabi Securities Exchange shed 7.7 percent to a four-year low, while Oman and Bahrain dipped 3.3 percent and 3.0 percent, respectively.
The bourses were battered on Sunday, the first trading day of the week, shedding tens of billions of dollars from their values, with Saudi Arabia, the leading bourse in the region, tumbling by 8.3 percent.
Oil prices crashed at the opening on Monday with the benchmark Brent crude diving to $33 a barrel.
The crash in oil, the mainstay of public revenues in the region, added to the panic that the ongoing price war may continue for a long time.
As the deadly coronavirus disease claims more lives around the world, dealers are fleeing out of riskier assets and into safe havens, sending gold and the yen surging and pushing US Treasury yields to new record lows.
Saudi Arabia launched an all-out oil war Sunday with the biggest cut in its prices in the past 20 years, after OPEC and its allies failed to clinch a deal to reduce output.
A meeting of main producers was expected to agree to deeper cuts to counter the impact of the coronavirus - but Moscow refused to tighten supply.
In response, Riyadh slashed its price for April delivery by $4-$6 a barrel to Asia and $7 to the United States.
Russia's decision not to comply had already battered prices and there are warnings they could continue to drive lower towards $20 if the two sides do not reach an agreement.