April 21, 2020: This is the first time in the history that US crude oil price dip below zero on Monday after the producers are forced to pay buyers because they are unable to store the crude oil supply left disordered by the COVID-19 pandemic. First time on record, the pandemic has triggered oil traders lurching.
Oil prices in the USA drop from $18 a barrel to -$38 in an hour, amid the rising stocks of crude oil warns overwhelmed storage facilities to manage the supplies have been affected by the Coronavirus outbreak. Now, the situation is that the oil producers are forced to pay the buyers to store the barrels they are unable to store.
The market crash amid the pandemic could shut down the economy of middle eastern countries as they are solely reliant on oil trade.
On Tuesday morning, the price dipped down below zero, as the USA benchmark company West Texas interacted for May shaking hands at $1.10 a barrel after stoke closing at minus $37.63 in New York on Monday. Experts say, “It could crash the economy of countries like Oman and Arab territories.” In today’s scenario the oil traders are actually paying buyers to purchase their stuff as they are running out of space to store the supply.
Coronavirus Outbreak: Highlights
- Several Energy Companies in America are Running Out of Space to Store Oil.
- World Wakes up to China’s Hostile Takeovers Amid Coronavirus Pandemic.
- US COVID-19 Confirmed Cases to Reach 800,000 as dead toll crossed 42,800.
- Donald Trump to Suspend All Immigration to US Amid COVID-19.
- New York Residents Sue WHO Over Coronavirus Response.
Danial Yergin, a renowned Pulitzer-winning oil trader, said “The May crude oil contract is going out not to whimper, but a primal scream.” He was the vice chairman of IHS Markit Ltd.
The crash came down to US President Donald Trump, who agreed to brokering a remarkable deal between the OPEC oil cartel and the USA (World’s Largest Oil Producing Nation) to cut down the oil production into the market.
Michael Lynch, President of Strategic Energy & Economic Research Inc said, “The background psychology right now is just massively bearish.” Citizens are concerned about the aftermath of the pandemic as they are going to see so much built up on inventories that is going to be tough to fix as there would so much distressed cargoes on the American market.
