Supply and demand currently diverge widely on the oil market. Because the corona crisis is causing a global economic downturn - and therefore less oil is needed. One variety in particular is affected.
New York / London (dpa) - Because of the corona crisis, the price of US crude oil has dropped to a historic low.
The price of a contract that provides for physical oil delivery in May was negative for the first time since futures trading began in 1983 - most recently at minus $ 18.20 a barrel (159 liters). This means that buyers receive money when they are accepted.
On the one hand, this shows how strongly supply and demand currently differ on the oil market. On the other hand, it is a very special phenomenon, due to the May futures contract on US oil expiring on Tuesday. In such contracts, the seller undertakes to deliver a specified amount of goods - in this case oil - at a fixed price and date.
Due to a toxic mixture of a sharply falling demand and a supply that is far too high, storage capacities are threatened in many countries. In any case, oil investors want to avoid finding a lack of storage space.
The following futures contract on American light oil (WTI) cost significantly more on Monday evening than the May contract. A barrel of Texas Light Oil (WTI) for delivery in June was quoted at $ 22.30 that evening. The North Sea variety Brent cost $ 26.50 a barrel. However, both prices were clearly in the red.
Due to the significantly higher prices for future oil deliveries, not only for US oil, some market participants spoke of a "super contango". Such a market situation is characterized by rising oil prices, the further their physical delivery lies in the future. This can be a sign of a currently particularly weak demand or a particularly high supply. Both currently apply.
The basic situation on the oil market is characterized by a supply that is much too high and demand is falling sharply. The corona crisis is causing a global economic downturn, resulting in falling oil, gasoline and diesel demand. Large oil producers such as Russia and Saudi Arabia have recently announced significant cuts in production. However, experts doubt whether the reductions are sufficient to match supply and demand.
In the United States in particular, oil storage facilities are at risk of bursting at the seams. Since the end of February, inventories in the important delivery location of Cushing have increased by almost 50 percent. As a result, the purchase prices paid continue to fall in the oil-rich region of Texas. In the meantime, there is even fear that negative prices will soon fall due for the purchase of crude oil if storage capacities shrink even further.