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Global oil markets remained under intense pressure on Tuesday, with Brent crude dropping below $20 per barrel for the first time in 18 years while other major benchmarks across the world tumbled. 

Brent, the international crude marker, slipped to $18.10, indicating that markets see no immediate let-up to the collapse in oil demand that sent some US oil benchmarks plunging under $0 for the first time on Monday, leaving producers paying for buyers to take their oil away while available storage is scarce.

Coronavirus has sent the oil sector into a state of crisis, with lockdowns implemented by authorities to smother the outbreak slashing demand for crude by as much as a third.

Contracts for the US benchmark West Texas Intermediate for delivery next month tumbled as low as minus $40 a barrel on Monday. Analysts at Citi warned that “if global storage worsens more quickly, Brent could chase WTI down to the bottom”.

The collapse in the May WTI contract was partly a technical product of the fact that it expires on Tuesday, meaning trading volumes were low and making the contract for June delivery more noteworthy, analysts said. That contract held above $20 a barrel on Monday but slid as much as 42 per cent on Tuesday to trade at lows of $11.79, suggesting the blowout in the May contract was more than a blip and that the entire global oil market faced challenges.

Goldman Sachs analysts said the June contact was likely to face downward pressure in the coming weeks, pointing to the “still unresolved market surplus”.

“As storage becomes saturated, price volatility will remain exceptionally high in coming weeks,” they said. “But with ultimately a finite amount of storage left to fill, production will soon need to fall sizeably to bring the market into balance, finally setting the stage for higher prices once demand gradually recovers.”

Warren Patterson, head of commodities strategy at ING, said it was likely that “storage this time next month will be even more of an issue, given the surplus environment”.

“And so in the absence of a meaningful demand recovery, negative prices could return for June,” he added.

European equities traded lower, partly dragged down by weaker energy stocks. The continent-wide Stoxx 600 was down 1.9 per cent, with its oil and gas sub-index dropping 3.3 per cent. In London the FTSE shed 1.7 per cent, while Frankfurt’s Dax slid 2.3 per cent. 

Equities were also broadly lower in Asia, with futures tipping US stocks to fall 1 per cent when trading in New York begins later.

On Wall Street overnight, the S&P 500 closed down 1.8 per cent, partly because of weakness in energy shares, but also due to increased pessimism over the time it will take for countries to emerge from lockdowns.

In fixed income, the yield on the 10-year US Treasury fell 0.03 percentage points to 0.585 per cent as investors retreated to the safety of the debt.

The decision of the Indian government to ease the coronavirus-linked global travel restrictions imposed on those having OCI cards has given a big relief to many stranded overseas citizens of India across the world.

OCI card is issued to people of Indian origin globally which gives them almost all the privileges of an Indian national except for the right to vote, government service and buying agricultural land. The OCI card gives them a visa-free travel to India.

On Friday, the central government allowed certain categories of OCI card holders, who are stranded abroad, to come to the country. Earlier, according to the regulations issued by the Indian government in April, visas of foreign nationals and OCI cards were suspended as part of the new international travel restrictions following the COVID-19 pandemic.

This privilege of visa free travel to India was causing distress among a large number of people of Indian-origin and Indian citizens in countries like the US whose children were OCI card holders as they were born in this country.

Many Indian parents, several of whom lost their jobs as a result of the economic crisis due to coronavirus pandemic, but were not allowed to take the special evacuation flights of Air India from various US cities, took to social media and urged the Indian leaders to allow them to travel to India.

“This is a big relief for the OCI card holders. It was a humanitarian crisis in the making. I am pleased that the Indian Government listened to their voices,” said social activist Prem Bhandari, chairman of Jaipur Foot USA, who has been taking up the cause of the OCI card holders.

Dr Arathi Krishna, former deputy chairperson of NRI Forum of Karnataka government, who had been demanding this relaxation, many of the thousands of stranded OCI card holders in defferent parts of the world were in pursuading her to exert pressure on the authorities concerned for this much needed relaxation.

The restrictions on traveling of OCI card holders to India was issued by govt of India on March 13 in the wake of global outbreak of coronavirus pandemic. 

She said: "Many parents who are Indian nationals could not travel for emergency purpose to India after repatriation flights started due to their minor children being OCI card holders. Many children who were OCI card holders could not travel to India to perform last rites when there was death in their family due to these restrictions"

"I was constantly pressurising and bringing these issues to the attention of ministry officials in External Affairs and Home Affairs departments. I was following up with Mr Dammu Ravi who is heading the COVID task force  task firce in the ministry of overseas Indian affairs who took interest in solving this problem through his consistent efforts with MHA. Iam thankful to Fireign Secretary too for his efforts and concern and to MHA for making it easier now for OCI card holders to travel in repatriation flights with emergency reasons," she said.