United States oil prices crashed Monday to a record low amid a collapse in demand caused by the coronavirus pandemic.
The U.S. oil futures went to $0 a barrel, the worst level since NYMEX opened oil futures trading in 1983.
The development came against the backdrop of an 18-year low drop in prices amid storage challenges.
Analysts said that record output cuts agreed by OPEC and its allies, OPEC+, are not enough to offset the loss in demand occasioned by the global downturn.
As factories and machines across the world grind to a halt, demand for oil as nosedived amid falling prices.
According to Bjornar Tonhaugen, head of oil markets at Rystad Energy, the May futures contract for West Texas International is about to expire, and frantic last minute trading is compounding concerns about how much oil the United States will be able to store as demand dries up.
This is leading to “large price swings”, he explained.
