New York (News Agencies): Wall Street dropped on Monday after U.S. crude futures turned negative for the first time ever. Oil Future traders forced to pay to unload crude as the May contract expired. Oil was the new victim of coronavirus.
The S&P energy index tumbled 3.7% after the front-month May U.S. West Texas Intermediate (WTI) contract actually turned negative, with sellers offering $37.63 a barrel to any traders willing to take it.
Demand of crude oil dropped to zero as coronavirus compelled billions of people around the world to stay at home.
“What the energy market is telling you is that demand isn’t coming back anytime soon, and there’s a supply glut,” said Kevin Flanagan, head of fixed income strategy at WisdomTree Asset Management in New York, Reuters News Agency.
He said lower oil prices could boost the economy if it encouraged people to buy more fuel, “but that requires people getting out.”
The energy index has lost 45% this year.