There were fresh falls on the London stock market trading early on Monday, followed by another bounce back, in signs of another volatile week to come for stocks. Oil giant BP was one of the worst affected as it announced more measures to combat the continuing impact of Covid-19 on its business. The slide in financial markets began as news emerged of many new coronavirus cases in China.

Beijing reported almost 80 new cases over the weekend, which has increased to 106 as of this morning, and only increased fears regarding a second wave of coronavirus still to come. More than 20 US states that ended their lockdown and social distancing measures have also recorded an increase in cases, and the country is still reporting hundreds of deaths every day for a total death toll now at 118,000.

BP share prices fell 5.5% at the opening bell on Monday morning, and were amongst the worst affected on the day. The fall came as BP announced it will take a write-down of up to £13.9 billion in its Q2 earnings. This follows a lowering of its long-term oil and gas price predictions because of an expected move away from polluting fossil fuels.

BP Building

The company earlier gave notice it will cut about 15% of its workforce in response to the coronavirus pandemic. Not only has the virus affected BP's current trading levels, but it anticipates that it will also accelerate the move to greener fuels and lower demand for oil.

The continuing climb in the share price of the Tesla Car company would appear to bear some credence to this view. On the current share trajectory, the electric car company could become the world's most valuable carmaker, despite making significantly less cars than many of its rivals.

BP CEO, Bernard Looney, explained to Reuters News his company will need to reinvent itself for the “new normal”, post-virus world. He said, 'We have reset our price outlook to reflect that impact and the likelihood of greater efforts to "build back better" towards a Paris-consistent world.'

Founded in 1909, BP is seen as a flagship British multinational company, and operates in nearly 80 countries worldwide. It is the world's sixth-largest energy company by market capitalisation and has the 12th largest turnover.

It is not the only oil company facing difficulties. Demand for oil and oil products has plummeted during the coronavirus crisis. Domestic petrol and diesel prices have fallen and demand from airlines has fallen dramatically.

Some fear passenger airline travel will never return to its previous levels; EasyJet is not expecting travel demand to recover to its pre-coronavirus levels until 2023 and has delayed the delivery of 24 new aircraft to between 2025 and 2027. Home working and lockdown restrictions have severely reduced car travel as well, and this is also expected to cause a long-term drop in demand for oil.

Members of the OPEC+ conglomerate will be reducing oil production to 9.6 million daily barrels until the end of next month. The move will be reviewed each month in view of the enduring impact the Coronavirus may have, as highlighted by the announcement from BP.

BP's nearest rival, Royal Dutch Shell PLC, is faring little better. This year, for the first time, the oil giant announced a two thirds reduction in its dividend.

Some Wall Street commentators believe the unexpected current stock market rallies are in part fuelled by inexperienced small investors. They point to rampant speculation on a swift end to the current crisis led by a voracious appetite for risk. The difficulties of two global players, such as BP and Shell, will be disturbing news for more experienced risk averse investors.