Ned Davis Research wrote in a note to clients Monday the coronavirus outbreak that began in China is a “true black swan” for the oil and energy markets, and that the worst is far from over.

Chinese demand for oil has been slashed by 2 million to 3 million barrels a day due to the outbreak.

“The oil market is looking down the barrel at no demand growth for the calendar year, and outright demand contraction is now on the table,” and “crude oil and energy equities will see more weakness before this is over,” according to analyst Warren Pies.

Pies, however, wasn’t all gloom and doom, saying it’s a “fools errand” to compare this pandemic to the 2003 SARS outbreak, and that investors should focus on “objective indicators.”

But China is the world’s No. 1 importer of oil, bringing in almost 11 million barrels of oil per day in the month of December, mostly from Saudi Arabia and Russia. According to reports, estimates are that oil demand has been slashed by about 3 million barrels per day, about 20%.

Worst-case scenario is Brent crude prices dip to $30 to $35 a barrel and stay there for several months, which would hammer countries like Saudi Arabia, Russia and the United Arab Emirates.

The U.S., meanwhile, wouldn’t come out unscathed, either. U.S. oil firms and shale firms in particular are currently producing record amounts of oil with higher break-even points than top oil producers in other countries.

If prices drop too far and don’t recover quickly enough, it will lead to layoffs and bankruptcies.

It could lead to cheaper gas prices for Americans, but that in turn would hurt the economy in one of its brightest spots heading into a presidential election in just over eight months.

The coronavirus also could weigh heavily on U.S. GDP this year, particularly in the first quarter. A CNBC survey of forecasters showed they see the Q1 GDP coming in at just 1.2%, down almost a whole 1% from Q4 2019.

UBS sees an even more grim picture, with Q1 GDP coming in as low as 0.4%. Action Economics is seeing it as high as 2%, according to CNBC.