U.S. Oil Prices Collapse In The Negative Zone As Crypto Market Follows Cue
The U.S. oil markets turns nastier as demand collapses on account of the Coronavirus pandemic turning bad every single day. The total COVID-19 cases in the U.S. have reached close to 800,000 with over 40,000 reported deaths.
The U.S. oil futures prices have turned negative for the first time on Monday, as the North American oil producers are running out of space to store the excess oil. There has been an unprecedented oversupply of oil in the market triggered by the virus outbreak.
The U.S. West Texas Intermediate (WTI) futures fell a massive -300% to just to $-40 a barrel. This has been the lowest the WTI Index has fallen in the history of the U.S. oil markets.
On the other hand, the Brent Crude has also dropped 6.36% or $1.76 reaching all the way to $26.72 per barrel. With the global travel as well as the local travel in many countries coming to a standstill, oil market investors are seeing no hope ahead.
The problem and imbalance in the demand and supply has now manifested in the form of falling crude prices. With the global oil reserve and storages coming to their maximum capacity, oil producers are having a tough time to keep their operations running.
The cryptocurrency market has also reacted negatively to this news as Bitcoin and several other cryptocurrencies are seen correcting around 5%. As such the crypto market has remained volatile to the falling oil markets over the last two months.
Last month, on account of the failing OPEC deal, the cryptocurrency markets also reacted negatively showing wild violative movement. However, the falling oil prices in the last few days hasn’t much impacted Bitcoin.
Although Bitcoin has shown some volatility over the last week, its price remains largely around $7000 levels. At press time, Bitcoin is trading 4.43% down at $6827 with a market cap of $125 billion.
Well, with the oil futures prices plunging this has been an unprecedented moment in the history. With the crude being commonly referred to as the block gold in the traditional markets, it has proved to be a massive wealth destroyer showing much higher volatility than cryptocurrencies, in 2020.