Coronavirus pandemic reduced oil demand. The world fuel oil market is facing severe losses. US oil price per barrel is ‘zero’ dollars. For the first time, the US price of oil is less in history.
Shares Monday (April 20) of crude oil companies fell 20 percent in the US stock market. As a result, the price of oil per barrel is below $15. However, in the futures market, the US price of oil for the month of May has stood below zero dollars per barrel. The country has never seen past such a drop in oil prices. The United States is seeing a drop in demand, mainly due to a global lockdown caused by the coronavirus.
For the first time the United States crude oil price crashes
Yesterday, crude oil prices in the US dropped to minus. One barrel (about 159 liters) of crude oil was sold that day minus -$37.63. Among the major oil-producing and supplying companies, Dow Johns Industrial dropped 592 points – a 2 percent reduction. The S&P 500 company too, dropped 2 percent. And Nasdaq is down 1%.
Wast Texas Intermediate (WTI) futures reported how much oil prices are this month. The futures contract expires on Tuesday (April 21). As a result, traders are desperate to release their oil reserves. The price has dropped by 90 percent. The situation is such that oil prices fell below zero dollars per barrel in the contract for next May in the futures market. This means that producers are paying the opposite buyers. Although in WTI futures The price of crude oil was set at $ 20.43 per barrel in June and $26.18 in July.
Producers fear, Their reserves will be full by next May. They will then be forced to hire tankers to stockpile additional supplies. In other words, producers have tried to reduce the cost of storage by reducing the price of oil excessively. This is mainly because prices in the US have reached negative levels or below zero dollars.
The demand for oil has decreased due to the limited travel of people. On the other hand, the oil storage facilities are full. As a result of these two, such a horrific image has been reflected in the market.
The National Average Gas Prices data show that the average price of vehicle gas in the United States has recently risen to $1.81 per gallon.
Brent and WTI Company oil price market share graph chart
Although the level of fall in the United States is high, the price of oil is falling almost all over the world. Talks began last week in oil-producing countries to bring the situation under control. After several talks on April 13, OPEC Plus and oil-producing allies reached a historic agreement to reduce production. The alliance of top oil producers and exporters agreed to reduce oil production by 9.7 million barrels per unit.
According to the Worldometer website data, about 803,575 people have been infected with coronavirus in the United States so far. 43 thousand 663 people died. In the state of New York alone, more than 256,272 people have been affected. About 19,410 people died there, which is about half of the country’s totally dead.
In the last 24 hours, more than 28,000 have been infected in the United States. And about 1 thousand 939 people died.