"The day started like any other gloomy Monday in the oil market’s worst crisis in a generation. It ended with prices falling below zero, thrusting markets into a parallel universe where traders were willing to pay $40 a barrel just to get somebody to take crude off their hands.
The move was so violent and shocking that many traders struggled to explain it. They grasped wildly at possible causes all day long -- had some big firm got caught wrong-footed? Or were inexperienced retail investors flummoxed by a market quirk? -- but had no tangible evidence of anything to point to.
West Texas Intermediate futures have been the benchmark for America’s oil industry for decades, seeing the market through booms, busts, wars and financial crises, but no single event holds a candle to this. By the end of trading, the contract had slumped from $17.85 a barrel to minus $37.63.
“Today was a devastating day for the global oil industry,” said Doug King, a hedge fund investor who co-founded the Merchant Commodity Fund. “U.S. storage is full or committed and some unfortunate market participants were carried out.”"
Javier Blas and Will Kennedy report for Bloomberg April 20, 2020.
SEE ALSO:
"U.S. Oil Price Collapses Below Zero As Storage Fills Up" (Houston Chronicle)
"Too Much Oil: How a Barrel Came to Be Worth Less Than Nothing" (New York Times)
"Oil Prices Collapse Below Zero, Scrambling The Clean Energy Transition" (Los Angeles Times)
"Oil Export Price For Mexico's Pemex Dips Into Negative Territory" (Reuters)
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