Opec and its allies are preparing emergency cuts in oil production after the crude price entered a bear market, driven lower by the impact of the coronavirus outbreak on demand in China. Brent crude, the international benchmark, fell on Monday to as low as $54.17 a barrel, down more than 4 per cent to its weakest level in more than a year and taking losses to more than 20 per cent since early January – the definition of a bear market.

The so-called Opec+ group, which includes the core members of the oil producers’ cartel and allies like Russia, is considering its response. The group fears prices will keep slipping unless it takes action to stem the fall. In a statement on Monday evening, the Kremlin said that president Vladimir Putin had taken a call from Saudi Arabia’s King Salman, and that both sides stood ready “to further co-ordinate their actions … to ensure stability on the global oil market.”

The oil price has been hard hit by the viral outbreak as traders fear that the closure of major cities and flight routes in China will lead to a direct hit on consumption. The country is second only to the US in oil use. Opec+ nations are due to assess the situation at technical meetings on Tuesday and Wednesday. Talks will focus on whether removing 500,000 barrels a day of output will be enough to prop up the market, according to people briefed on the discussions. The core Opec group pumped about 29-4m b/ d in December, a number that probably slipped in January after the loss of around 1m b/ d from Libya.

No deal has yet been agreed. Some members think more time is needed to understand the full impact of the virus on demand, according to those people briefed. Ministers for the countries were originally due to meet in early March but are now expected to convene later this month.