US oil price negative for the first time in history Financial

This is reported by the financial news agency Bloomberg. This means that oil companies pay traders to purchase oil to avoid stopping oil production in certain fields.

This price has not been so low since the start of trading in WTI in 1983. As of Friday, the price was still at $ 18.25 a barrel.

The continuing drop in the oil price is mainly caused by the fact that the demand for oil has plummeted due to the corona crisis. Prices on the oil market are subject to so-called forward contracts. The trade is currently focusing on forward contracts for the supply of oil in the month of May. However, there is hardly any demand for this because many economies worldwide are largely flat.

Later this week, trading will focus on contracts for June. Then the price is likely to rise again.

OPEC, Russia and other oil producing countries agreed earlier this month to cut production by nearly 10 million barrels per day to boost prices. But that has had little effect yet.

–