Oil producers pay money to get rid of their stocks after the price collapse

Shafaq News / US crude prices have declined significantly in recent times, reaching two dollars a barrel and less than zero in Texas, reflecting the size of the current crisis due to the growing crude stocks in the country.

This is due to the collapse in demand, supply inflation and poor storage capacity, given the emerging crisis of Corona virus and its implications for the market.

Oil prices remained in crisis even after the Organization of Petroleum Exporting Countries (OPEC) and other producers announced an agreement to cut production by 10 million barrels per day.

Bloomberg said that falling prices may increase the likelihood that Texas producers will soon have to pay customers to dispose of their oil barrels, similar to Wyoming crude that was offered at a negative price of 19 cents last month.

"I've never seen Texas Crude turn into a negative price," said Andy Libo, president of Lipo Oil Associates in Houston.

Offers may continue to decline if the futures contract continues to decline relative to West Texas Intermediate, the benchmark, as contracts have lost three quarters of their value this year, to collapse.

WTI closed below $ 20 a barrel this week for the first time since 2002