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(CNN) - Oil is so cheap that producers are paying warehousekeepers to remove barrels from their hands.
US crude oil plummeted to less than US $ 0 to US $ -1.43 per barrel on Monday; It is the lowest price since Nymex opened the oil futures trade in 1983.
That marks an impressive one-day decline from Friday's close of $ 18.27 a barrel.
The historical collapse shows that the market is betting that the OPEC + production cuts announced earlier this month are not enough to offset the unprecedented demand caused by the pandemic.
Part of the slump this Monday is due to the fact that the May futures contract expires this Tuesday, amplifying fears about a lack of storage space.
The June contract is not selling nearly as much, losing just 10% at $ 21.97 a barrel.
The slump on Monday was fueled by two main forces: the expiration of the oil futures contract and the rapid disappearance of space to store unnecessary barrels of oil. Although the May contract fell below $ 11 in low volume, the June contract traded above $ 22.
MIRA: Oil prices reach their lowest level since 1999
That incredibly large range is due to the storage problem. Companies will have to stack barrels in more expensive places like ships. The wider the extension, the more economical these storage alternatives would be.
The remaining storage of 21 million barrels in downtown Cushing, Oklahoma, is likely to fill up in May, causing "panic" in the oil markets, Bjornar Tonhaugen, head of oil markets at Rystad Energy, wrote in an email.
Oil prices rose above $ 28 a barrel on April 3 after President Donald Trump spoke of massive production cuts by Saudi Arabia and Russia.
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