(Mar 17): Oil futures traded near a four-year low below US$30 ($42.57) a barrel as the shut down of swathes of the world’s economy triggers a meltdown in global fuel demand.

New York crude futures edged marginally higher in early Asian trade on Tuesday but gains were eclipsed by the previous day’s 9.6% collapse that took them to the lowest since February 2016. Fuel consumption is getting hammered, with U.S. gasoline prices plunging 23%, as governments restrict the movement of people by closing their borders and banning travel.

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With airlines cutting the number of flights daily and a growing number of European countries in lock-down, oil markets are heading for an unprecedented glut. All the while, Saudi Arabia and Russia are planning to boost crude production as they engage in a price war for market share.

Leaders of the Group of Seven said they will do “whatever is necessary” to ensure a globally coordinated response to the coronavirus pandemic and its economic fallout. U.S. President Donald Trump markedly changed his tone on the outbreak and said Americans should avoid gathering in groups of more than 10 people, while Canada closed its borders to most foreigners. France said it may further tighten a national lock-down, while Germany partially closed its borders with five neighboring countries.

West Texas Intermediate crude for April delivery rose 56 US cents to US$29.26 a barrel on the New York Mercantile Exchange at 7:22 a.m. Singapore time. It fell more than US$3 to US$28.70 a barrel on Monday. Brent crude for May settlement dropped US$3.80, or 11%, to US$30.05.

The spectacular plunge in prices hasn’t deterred state-run Saudi Aramco from pumping historic levels of oil. The company plans to produce at its maximum capacity of 12 million barrels a day in April, Chief Executive Officer Amin Nasser told investors, adding, “I doubt if May will be any different.”

The country is showing no sign of backing down in its price war with Russia, with Aramco saying it’s “very comfortable” with oil prices below US$30 a barrel.

The collapse in demand has brought gasoline prices in the U.S. close to parity with WTI, briefly dipping below the U.S. benchmark for the first time since 2009. As recently as March 10, Nymex gasoline futures traded at a premium of almost US$18 a barrel to WTI.

Gasoline tumbled by 23% on Monday, the biggest drop since 2005. They were up 7.5% at 74.19 cents a gallon in light volumes on Tuesday.