Oil prices could remain weak in March and April, even if OPEC cuts production - S&P Global Platts

CNBC reports that even if OPEC cuts production by 600,000 barrels a day, oil prices could remain weak until April, according to a senior analyst at S&P Global Platts.

That's because inventories are rising amid lower oil demand due to the coronavirus outbreak, Kang Wu, Asia's head of analytics, told CNBC.

Oil prices have been under pressure because of the virus that shuttered Chinese businesses for weeks and forced flight cancellations around the world. Infections first surfaced in the Chinese city of Wuhan, and the virus has since killed nearly 2,800 people in China. It has also spread globally, with cases in South Korea, Iran and Italy surging this week.

That's what S&P Global Platts expects at the March 5 and 6 OPEC meeting, Wu said.

"Saudi Arabia is the key player, they're already over compliant," he said. "So the 600,000 barrels a day will add to that supply constraint, will lend some support to the market."

However, the current buildup in inventories may need to be absorbed in April, he said. "In terms of prices, (the market) could still be weak in March and April, before it improves in the summer."