VIENNA (Reuters) – Austrian energy group OMV posted a net loss for the first quarter due to significant inventory costs and lowered its production target and crude price forecasts in response to tumbling oil demand in the wake of the coronavirus pandemic.

OMV said on Wednesday it lost 68 million euros ($74 million) in the three months through March after a profit of 496 million in the previous year’s period.

Oil prices sank 65% in the first three months of the year to lows of $22 a barrel as strict movement restrictions imposed around the world to limit the spread of the coronavirus led to a collapse in demand for transportation fuels.

A fight for market share between top producers Saudi Arabia and Russia accelerated price falls.

April has seen the most turbulent days in the history of oil trading as investors confronted the reality that worldwide supply will overwhelm demand for months or years and current production cuts to offset that glut are seen as nowhere near sufficient. U.S. crude futures fell into negative territory for the first time in history.

OMV said it expects the Brent oil price to average $40 per barrel this year and saw the realised gas price at 11.9 euros per megawatt hour.

It now sees its 2020 output at 440,000 barrels of oil equivalent per day (boed) instead of its previous target of 500,000 boed.

Clean current cost of supplies (CCS) earnings before interest and tax (EBIT), which exclude special items and inventory gains or losses, fell 8% in the quarter to 699 million euros, above an average estimate of 573 million euros in an OMV poll of 15 analysts. The group benefited from lower production costs and lower input prices for its refineries.

Quarterly cash flow from operating activities was 838 million euros and its cash position at end-March was 2.8 billion euros.

($1 = 0.9214 euros)

(Reporting by Kirsti Knolle, editing by John Miller and Michael Shields)