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This is what happens when you shut down the country....still think we should keep it shut down? This will only get worse if things don't open back up soon.
Over simplification of the issue.
The oil price plunge started before the health crisis.
The oil price plunge started before the health crisis.
Didn't help but wasn't the catalyst.
It's really not. The shutdown is what has directly led to the lack of demand that was always going to cause this once they weren't able to store any more excess.
The Saudis and Russians playing games didn't help anything, but this was inevitable once the country shut down. When you cut off demand, product stacks up and once you run out of the ability to store it, the price goes negative as you need people to take it off your hands.
US oil trades at negative prices for first time in history*
Benchmark collapses to unprecedented low as traders try to rid themselves of unwanted crude**
by David Sheppard, Myles McCormick and Derek Brower in London and Hudson Lockett in Hong Kong
17 MINUTES AGO
Benchmark US oil prices crashed into negative territory for the first time in history as the evaporation of demand caused by the coronavirus pandemic leaves the world awash with oil and not enough storage capacity — meaning producers are paying buyers to take it off their hands.
West Texas Intermediate, the US marker, lost more than 250 per cent on Monday*to trade as low as -$40.32 a barrel in a day of chaos in oil markets. Traders capitulated in the face of limited access to storage capacity across the US, including the country’s main delivery point of Cushing, Oklahoma.
The dollar figure given in this article, published less than 30 minutes ago, is negative $40.32 per barrel, for crude oil.
They're willing to pay you $40.32 per barrel to take it off their hands.
I have never seen this before, but they are now paying people to FILL up their cars with gasoline! Not really, but I have never seen a commodities market go NEGATIVE.
Much of the drop into negative territory was chalked up to technical reasons — the May delivery contract is close to expiring so it was seeing less trading volume, which can exacerbate swings. But prices for deliveries even further into the future, which were seeing larger trading volumes, also plunged. Demand for oil has collapsed so much due to the coronavirus pandemic that facilities for storing crude are nearly full.
Quote:
Originally Posted by Pilot1
I have never seen this before, but they are now paying people to FILL up their cars with gasoline! Not really, but I have never seen a commodities market go NEGATIVE.
Nobody has seen this before.
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