As rapidly vanishing demand drives crude prices to multi-decade lows, cargoes offered by oil traders across the globe far in advance. The value of some US oil is roughly $10 a barrel.
Due to the coronavirus pandemic and Saudi Arabia-Russia price war, the oil market is caught between a collapse in demand. Markets are predicted flooded with oil due to both factors.
While major operators like IOC (India) have declared force majeure on crude purchases, refineries worldwide have started to shut units. At below $10 per barrel, key benchmarks in Mexico and Canada on Monday traded less than the cost of production.
As lockdowns hammer fuel needs, global oil demand is estimated by Trafigura on Monday to fall by about 30 million bpd (33 percent of daily world consumption).
Next week, Saudi Arabia’s official selling prices is scheduled to announce. May cargoes of WTI Midland offered by traders to Europe unusually far in advance. Cargoes for delivery in May typically do not surface until at least April.
