Black Monday: Why cheap oil sent the world’s stock markets into a tailspin

Panic stalked the markets with traders’ screens showing a sea of red, writes James Moore

Crude oil prices have plummeted as global demand has eased and new supplies such as US shale oil have come on to the market (AP)

The economic black swan event that’s called Covid-19 might have found a mate. Flying in from the east comes an oil price shock courtesy of a row between Russia and Saudi Arabia.

The latter knocked 20 per cent off crude and contributed to an 8 per cent fall in value of the FTSE 100 upon the opening of trading.

While the index subsequently recovered a bit, it was still grappling with its worst single day since the financial crisis. The screens used by traders looked like a sellout crowd at Old Trafford in terms of colour.