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Oil Doesn’t Spark Joy: Storage Crunch Gets Crude Price Below $0

It’s hard enough to believe that oil could ever be priced at zero, but how is it possible for it to dip below zero?

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2020 has been a year of many firsts – a pandemic on a truly global scale, a lockdown on movement across the world, the worst recession in the making and something as unimaginable as crude oil cost actually dipping below zero.

On 20 April, the US' benchmark index for crude oil, WTI crude or West Texas Intermediate which is the best quality of crude oil in the world, was priced at -$40.32 a barrel in New York. That effectively means oil sellers would be paying buyers to take the oil off their hands.

It's hard enough to believe that oil could ever be priced at zero, but how is it even possible for it to dip below zero? Let's break it down.

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