By the time most Indians woke up on Tuesday morning, crude oil prices had fallen below zero for the first time in history.
Rising fears over fuel storage facilities being overwhelmed by the excessive supply are compounding to oil's woes and offered investors another reason to attack the already battered commodity, Otunuga said. Crude explorers shut down 13% of the USA drilling fleet last week as the swelling worldwide glut of crude spurred drastic cost-cutting and project cancellations among drillers.
Regardless of what OPEC does, there will be structural demand loss for oil due to less travel. With no end in sight, and producers around the world continuing to pump, that's causing a fire-sale among traders who don't have access to storage.
West Texas is only one measure of the "oil price" there are others - like Brent - which haven't collapsed in the same way. "Until demand shows some sign of life, oil prices will likely remain on life support".
United States crude oil bounced back into positive territory today, but a historic plunge below zero rattled investors and triggered the steepest drop in Asian stock markets in a month.
AxiCorp global chief market strategist Stephen Innes said the West Texas Intermediate (WTI) crude oil futures for May contract 2020 traded to -US$40.32 (RM177) per barrel. It's far below the lowest level previous seen in continuation monthly data charts since 1946, just after World War II, according to data from the Federal Reserve Bank of St. Louis.
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It also found that just 5 per cent of coronavirus hospitalisations were current smokers. Information for deaths recorded after April 9 will be updated on Friday, April 17.
Brent crude futures for June slumped 29% to $18.20 a barrel.
Contracts WTI with delivery in June sold on the exchange at 21.8 Dollars per barrel. Capacity at the hub is about 76 million barrels, according to the EIA.
The dispute was allegedly sparked by Saudi Arabia advocating a coordinated reduction in oil output by all OPEC+ countries (which includes Russia) in an effort to keep the price of the commodity high.
As for the US, President Donald Trump said that the government will buy the overstock of oil to help the production companies.
The price collapse is reverberating across the oil industry. Crude explorers shut down 13 per cent of the American drilling fleet last week. "Will not escape the impact", said Deirdre Michie, head of OGUK. Russian Federation said that it is monitoring prices closely, but hasn't decided on Venezuela's call for an OPEC+ committee meeting. "It's undeniable that the USO is having a having a very big effect on the June contract and it wouldn't be surprising if we go substantially lower".
"Ordinarily you'd be looking at oil as an inflation indicator, but then it turned into an economic-activity indicator".