No, your monitor is not malfunctioning.
Oil prices CLK20, -104.17% made history Monday, finishing in negative territory and implying that investors will need to pay buyers to take a barrel of crude. That’s what happens when the world shuts down in the face of a pandemic and oil companies are left to store surplus in rented tankers.
“It’s like trying to explain something that is unprecedented and seemingly unreal!” wrote Louise Dickson, oil markets analyst Louise at Rystad Energy, in emailed comments.
Longtime commodities trader Peter Brandt tried to put the move in perspective:
Peter Brandt✔@PeterLBrandt
How much blood will be on the street b/c of Crude Oil?
Bankrupt trading firms
NYMEX — margin calls not met
Futures Commission MerchantsThis is going to be ugly. Books will be written about today. $CL_F
As did other notable voices on Finance Twitter:
Joe Weisenthal@TheStalwartI took my eye off of oil for a second, because I thought all the fireworks kind of happened when it went negative.
But I have to admit that seeing it trade at *-$40* a barrel is quite something!! https://www.bloomberg.com/news/articles/2020-04-19/oil-drops-to-18-year-low-on-global-demand-crunch-storage-woes?srnd=premium&sref=vuYGislZ …
Sven Henrich✔@NorthmanTrader
Negative rates: Mortgage companies pay us to live in our homes.
Negative oil: Gas stations pay us to fill up.
The Fed will save them all.Who needs a job anyways.
Mir Mohammad Alikhan@MirMAKOfficialWhy is oil price down ?
1. Corona has evaporated the demand. Air travel. Sea cargo. Road travel. Energy. Etc
2. Low demand is creating pile ups of inventories
3. No Storage facilities to keep the oil
4. Russia KSA arrogance of not cutting production EARLIER
EXPLAINED SIMPLY
Then there were those with an agenda:
Cameron Winklevoss✔@winklevoss
After today, oil can no longer be considered a reliable store of value. Your next best options are the U.S. dollar (gulp), gold (scarce), or Bitcoin (fixed).
Eric Holthaus✔@EricHolthaus
The takeaway here is clear, for those of us who care about climate: This system is unsustainable.
We knew that oil was worthless before today. Now it’s literally true. Whatever emerges in the wreckage of the fossil fuel industry, it can’t continue on like it was before.
Eric Holthaus✔@EricHolthaus
Right now, the price of oil is negative. It’s less than worthless.
Now is the time to imagine alternatives to the fossil fuel industry. The old world has collapsed. What comes next is up to us.https://thecorrespondent.com/385/we-arent-just-stopping-coronavirus-were-building-a-new-world/50968856015-625b9768 …
We aren’t just stopping coronavirus. We’re building a new world
We must pressure our leaders to take the long view in any coronavirus economic recovery package, even if this feels like a short-term emergency.
thecorrespondent.com
For the most part, confusion reigned across social media:
Katie Hill✔@KatieHill4CA
Negative oil price… I don’t even know what that means https://twitter.com/faisalislam/status/1252303015501070339 …
Faisal Islam✔@faisalislam
The Crude oil price (West Texas Intermediate)…
Has turned NEGATIVE….
MINUS $10 for a barrel of WTI oil… as they can’t find places to store it…
via @Refinitiv
Prof. Steve Hanke✔@steve_hanke
Today, #WTI crashed from an open of $17.85/ barrel to a low of -$40.32/ barrel.
What is going?
Oil storage tanks are full to the brim.
Mark this day on your calendar. You will never see a day like it again.#OilPrices #OilCrash
Josh Jordan✔@NumbersMuncher
OMG: WTI crude oil for May delivery ends the day at NEGATIVE $37.63 per barrel.
It was $63 in early January – this is hard to even comprehend. #OilPrice
It’s not really a laughing matter, according to The Blaze’s Jessica Fletcher:
Jessica Fletcher✔@heckyessica
before you make a joke about oil prices, remember that the industry employs many, many Americans, and they (and their families) are scared while you’re laughing.
But, of course, the jokes were flying anyway:
Wild Geerters@classiclib3ralme going door to door trying to sell the oil barrels I bought at negative prices
neontaster@neontasterUse your $1,200 to buy a couple thousand barrels of oil.
Adam Serwer
✔@AdamSerwer
Call me when OLIVE oil is under $2 a barrel
And it didn’t take long for the buzz to turn political:
Rick Wilson✔@TheRickWilson
I thought President Bigly Dealmaker had this in hand! https://twitter.com/business/status/1252286893720551424 …
Bloomberg✔@business
BREAKING: Oil drops below $3 a barrel https://trib.al/o219x5F
Tea Pain@TeaPainUSADonald Trump has managed to do somethin’ no other president could. Destroy the oil and gas industry.https://www.cnn.com/2020/04/20/investing/premarket-stocks-trading/index.html …
American oil crashes below $0 a barrel — a record low
The spectacular collapse in oil markets is showing no signs of easing, as the coronavirus crisis saps demand and producers run out of places to store all their excess barrels of crude.
cnn.com
Michael McKean✔@MJMcKean
To a guy who can bankrupt a casino multiple times, crashing the oil business is a piece of cake. https://twitter.com/business/status/1252293838795878400 …
Bloomberg✔@business
BREAKING: Oil drops below $1 a barrel https://trib.al/l9YLU35
