The US crude, also known as West Texas Intermediate, is currently trading in negative territory at $-2 per barrel.
This is the lowest point ever. The last time prices dipped so low was in 1915 when it traded at 40 cents.
In contrast, Brent crude, which Nigeria’s crude is priced on, is trading at $26.36.
The New York Mercantile Exchange (NYMEX), a commodity futures exchange owned and operated by CME Group of Chicago, was quoted on Monday to have said WTI May futures could drop into negative territory.
“It is now possible to negative price for May futures only,” a CME Group spokesman said.
The percentage change in price is estimated -110% by Bloomberg energy terminal.
At the beginning of 2020, WTI crude was trading at $60 per barrel.
However, reduced demand due to the coronavirus pandemic and a price war between Saudi Arabia and Russia saw prices plummet.
WTI crude is delivered physically at Cushing in Oklahoma where the Energy Information Administration estimates total storage capacity is reported to be 80 million barrels.
As of April 10, stocks held in storage was reported to be 55 million barrels.
Commenting on the market situation, Abhi Rajendran, director of research and advisory for Energy Intelligence, said May WTI “has no value for physical delivery. It’s worthless”.
US President Donald Trump had lobbied Saudi Arabia to cut oil supply as part of efforts to mop up a supply glut.
At the end of a two-day virtual meeting, the Organisation of Petroleum Exporting Countries and its allies had agreed to cut 10 million barrels in supply off the market.