Of all the wild, unprecedented swings in financial markets since the
coronavirus pandemic broke out, none has been more jaw-dropping than Monday’s
collapse in a key segment of U.S. oil trading.
The price on the futures contract
for West Texas crude that is due to expire Tuesday fell into negative territory
— minus $37.63 a barrel. That’s right, sellers were actually
paying buyers to take the stuff off their hands.
The reason: with the pandemic bringing the economy to a standstill, there is so
much unused oil sloshing around, American energy companies have run out of room
to store it.
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