Oil prices plummeted on Wednesday, and investors began to take short positions after three sessions of decline in commodity prices. This is due to increased concerns that the rapid spread of the coronavirus will lead to a global pandemic.

The price of the international Brent variety drops by 0.31 USD, or 0.56%, to 54.64 USD per barrel, while the futures on the US light crude oil WTI declined by 0.26% to 49.75 USD per barrel.

Pandemic fears escalated as the coronavirus spread to more countries. In Iran, the death toll reached 16, which is the highest number of deaths outside China. At the same time, those infected in South Korea and Italy continue to increase.

The Centers for Disease Control and Prevention in the United States said Americans should be prepared for the possible spread of the virus.

“Investors are taking short positions after the WTI price fell below the key 50 USD level, as they did several times earlier this month”, said Hideshi Matsunaga, an analyst at Sunward Trading. “The decline in Libyan production and the expectation of further OPEC+ yield cuts also contribute to price increases”, added he.

The crude oil production in Libya has fallen sharply since January 18 because of blockades of ports and oilfields by groups loyal to Libyan National Army commander Khalifa Haftar.

OPEC countries and their allies in the group known as OPEC+ are due to meet in Vienna on March 5 and 6.

Saudi Arabia’s energy minister said Tuesday that he is confident that OPEC and its partners will respond to the spread of the coronavirus.

The International Energy Agency’s (IEA) forecast for global oil demand growth has been lowered to its lowest level in a decade, according to the Executive Director of the International Energy Agency Fatih Birol, leaving the possibility of a further contraction due to the coronavirus.

At the same time, US crude oil stocks are expected to increase for the fifth consecutive week. The American Petroleum Institute (API) said on Tuesday that crude stocks rose by 1.3 million barrels last week.

In the meantime, the United States is preparing to impose more sanctions on Venezuela’s oil sector in an attempt to obstruct the financing of President Nicolas Maduro’s government, revealed the US President Donald Trump.