US running out of places to store oil
Islamabad, April 21, 2020:In a bizarre movement in the oil market, the oil prices turns Into negative territory on Monday.
The price of a barrel of oil went negative due to lower demand and uncertainty in the oil market.
The Future contract for the month of May of the World wide Crude oil has been paused and plunged at Negative -37 dollar a barrel. While, the June future contract are still lower side and ended below 20 dollars a barrel.
The future contract for West Texas crude that is due to expire Tuesday fell into negative territory minus $37.63 a barrel.
Oil prices continued downward journey as the economic crisis set off by the COIVD-19 pandemic is destroying the demand for energy across the world.
Industry sources said that concerns grew as the storage capacity of the United States is unable to hold all the unused crude oil.
Read more: Stock market declines on oil crisis
Therefore the next month (May) delivery prices plunged and went negative. It mean oil has become worthless and sellers or were willing to pay for oil to them, who will be taken off their stocks.
However, the oil prices for June delivery also one decline and fell 16 percent to about $21 a barrel.
According to sources the major issue come from US as it is running out of places to store its oil.