For the first time in history, the price of WTI oil turned negative.
US President Donald Trump has made it clear that he intends to take advantage of the collapse in oil prices to replenish the US Strategic oil reserve.
“Now is a great time to buy oil,” the President announced.
He did not acknowledge the negative consequences of falling prices for geopolitics and employment in the national energy sector against the background of the coronavirus pandemic, telling reporters that “the problem is that no one else in the world drives a car.”
The President, who wants to add up to 75 million barrels to the Strategic oil reserve, said: “If we can’t buy it for a song, we’ll take whatever we can get.”
Trump also said that he is considering stopping oil supplies from Saudi Arabia.
Prices for May futures contracts for American WTI oil fell to minus 37.63 dollars per barrel by the end of trading. This is the first time that the price of this product has become negative.
Against the background of evaporated demand, holders of May contracts have to organize the delivery of their barrels of oil on Tuesday.
“Prices will go up and the energy business will be strong,” Trump predicted, noting that other types of crude oil are still trading above $25 per barrel.
For several weeks, prices have been under pressure due to an epidemic hitting demand and a price war between Saudi Arabia and Russia, which have ramped up production. More than a week ago, they agreed to cut supplies by 9.7 million barrels per day, but this will not immediately reduce the global glut.
Saudi Arabia is considering cutting production as soon as possible, without waiting for May, the Wall Street Journal reported in a tweet.