Biggest drop in oil prices in decades
Russia blocked a cut to oil output leading Saudi Arabia to declare it would dramatically boost production to price out its rival.
Combined with reduced demand over coronavirus fears that have led energy experts to predict that the price of oil could drop below $20 a barrel.
The shock drop in prices comes after an agreement on production between Saudi Arabia and Russia fell apart.
Saudi Arabia last week pushed for a reduction in production to counter the impact of the coronavirus outbreak.
However Russia, the world's second largest oil producer and not part of the OPEC cartel, refused to tighten supply.
This led Riyadh to announce the biggest cuts to prices in 20 years on Sunday.
The drop is the lowest since the end of the Gulf War in 1991 with prices reduced by nearly a third.
The price of crude went down by 27 percent to $30.04 and prices are predicted to drop further.
It has also led to a stock market crash with Saudi equities tanked more than nine percent and Aramco losing 10 percent.
The collapse in prices could lead to cancellation of oil exploration projects and even sparking global deflation.
"A 30 percent plunge in crude oil prices is unprecedented and is sending a huge shockwave across financial markets," said Margaret Yang, an analyst from CMC Markets.
Russia might be pushed by to the negotiating table with OPEC and agree on an output cut to shore up markets.
It is reminiscent of the oil price war that erupted in 2014 and sent oil prices crashing to less than $30 a barrel.
The price fall then battered revenues in the Gulf countries, forcing them to resort to austerity measures and borrowing to plug budget deficits.