A
historic drop in the price of the WTI crude oil below 0 has shocked
the markets and has signified exactly how stagnant the present
economy is. A number of factors have contributed to a global demand
slowdown that has also negatively impacted the consumption of oil
worldwide. As such, many economies that would previously be seeking
to purchase the precious source of energy have found themselves in an
overabundance and also short on means to store it. This has, in
effect, caused the negative price as many were scrambling to fill up
their storages and tankers while producers were not able to get the
quantities off their hands quickly enough.
Similarly,
the UK flavor of Oil – Brent has taken a hit as well, albeit not as
hard – dropping “only” 10%.
It
is speculated that the US may even look into preventing import as the
stockpile may reach it’s capacity by early to mid May.
Measures
are also being taken by the OPEC+ group and drastic reductions in
output are all but certain in order to stabilize the price and ensure
that it’s members do not suffer massive reductions in their
revenues and face fiscal issues later this year.
