U.S. energy trading experts said Monday's first-ever oil futures crash below $0 does not mean that Americans will suddenly be paid to fill up their cars' gas tanks.
United States crude oil futures crashed below $0 Monday to go negative for the first time in history, with energy industry experts pointing to uncertainty over coronavirus lockdown demand and a lack of storage space.
"There is an immediate lack of demand for oil coming out of the ground due to the global shelter-in-place orders and right now handlers are better off saying, 'here just take this, get rid of this for me,'" Iaccino told."With prices currently falling below negative $35 to $40 per barrel, this means purchasers could buy 1,000 barrels on credit and receive $35,000 just to take delivery of the crude oil...but you can't just store it in your garage.
"While on the surface, a $0 oil price would suggest producers stop production, in theory, it is more economic to pay someone to take the crude rather than shut the well up to the shut in cost," Amrita Sen, Chief oil analyst at Energy Aspects, toldHe warned Americans that the dramatic oil futures crash is likely not reflective of the long-term value and that Monday's negative price does not mean drivers"will be paid to fill up their gas tanks.
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