Of all the wild,unprecedented swings in financial markets since the coronavirus pandemic broke out,none has been more jaw-dropping than Monday's collapse in a key segment of U.S.oil trading.
The price on the futures contract for West Texas crude that is due to expire Tuesday fell into negative territory--minus$37.63 a barrel.The reason:with the pandemic bringing the economy to a standstill,there is so much unused oil sloshing around that American energy companies have run out of room to store it.And if there's no place to put the oil,no one wants a crude contract that is about to come due.
Underscoring just how acute the concern is over the lack of immediate storage space,the price on the futures contract due a month later settled at$20.43 per barrel.That gap between the two contracts is by far the biggest ever.
"The May crude oil contract is going out not with a whimper,but a primal scream,"said Daniel Yergin,a Pulitzer Prize-winning oil historian and vice chairman of IHS Markit Ltd.
普利策奖获得者、IHS Markit ltd.副董事长丹尼尔·耶金(Daniel Yergin)说，"5月份的原油合约不是一声呜咽，而是一声原始的呐喊。"。
"There is little to prevent the physical market from the further acute downside path over the near term,"said Michael Tran,managing director of global energy strategy at RBC Capital Markets."Refiners are rejecting barrels at a historic pace and with U.S.storage levels sprinting to the brim,market forces will inflict further pain until either we hit rock bottom,or COVID clears,whichever comes first,but it looks like the former."
加拿大皇家银行资本市场(RBC Capital Markets)全球能源策略董事总经理迈克尔•特兰(Michael Tran)表示:"短期内，几乎没有什么能阻止现货市场进一步急剧下行。"。"炼油厂正以历史性的速度拒绝提供原油，而且随着美国的原油储备水平急剧下降，市场力量将造成进一步的痛苦，直到我们或者触底，或者 ovid 清理完毕，不管哪个先清理，但看起来都像是前者。"
Since the start of the year,oil prices have plunged after the compounding impacts of the coronavirus and a breakdown in the original OPEC+agreement.With no end in sight,and producers around the world continuing to pump,that's causing a fire-sale among traders who don't have access to storage.
The extreme move showed just how oversupplied the U.S.oil market has become with industrial and economic activity grinding to a halt as governments around the globe extend shutdowns due to the swift spread of the coronavirus.An unprecedented output deal by OPEC and allied members a week ago to curb supply is proving too little too late in the face a one-third collapse in global demand.
There are signs of weakness everywhere.Even before Monday's plunge,buyers in Texas were offering as little as$2 a barrel last week for some oil streams.In Asia,bankers are increasingly reluctant to give commodity traders the credit to survive as lenders grow ever more fearful about the risk of a catastrophic default.
In New York,West Texas Intermediate for May delivery dropped as low as negative$40.32 a barrel.It's far below the lowest level previous seen in continuation monthly data charts since 1946,just after World War II,according to data from the Federal Reserve Bank of St.Louis.Brent declined 8.9%to$25.57 a barrel.
Crude stockpiles at Cushing--America's key storage hub and delivery point of the West Texas Intermediate contract--have jumped 48%to almost 55 million barrels since the end of February.The hub had working storage capacity of 76 million as of Sept.30,according to the Energy Information Administration.
Despite the weakness in headline prices,retail investors are continuing to plow money back into oil futures.The U.S.Oil Fund ETF saw a record$552 million come in on Friday,taking total inflows last week to$1.6 billion.
尽管总体价格疲软，但散户投资者仍继续将资金投入石油期货。美国石油基金 ETF 上周五录得创纪录的5.52亿美元资金流入，使上周资金流入总额达到16亿美元。
The price collapse is reverberating across the oil industry.Crude explorers shut down 13%of the American drilling fleet last week.While production cuts in the country are gaining pace,it isn't happening quickly enough to avoid storage filling to maximum levels,said Paul Horsnell,head of commodities at Standard Chartered.
油价暴跌正在整个石油行业引起反响。上周，原油勘探公司关闭了美国13%的钻井船队。尽管美国的减产步伐正在加快，但这并没有发生得足够快，无法避免最大限度地满足库存需求，渣打银行集团大宗商品部主管 Paul Horsnell 说。
"The background psychology right now is just massively bearish,"Michael Lynch,president of Strategic Energy&Economic Research Inc said in a phone interview."People are concerned that we are going to see so much build up of inventory that it's going to be very difficult to fix in the near term and there is going to be a lot distressed cargoes on the market.People are trying to get rid of the oil and there are no buyers."
—With assistance by Javier Blas,and Elizabeth Low