Oil Futures See Another Weak Session, Settle Sharply Lower

After seeing wild swings right through the session following a historic plunge to sub-zero levels a day earlier, U.S. crude oil futures settled sharply lower on Tuesday.

Mounting worries about oversupply in the global crude market and lack of storage facilities knocked the wind out of the commodity once again.

West Texas Intermediate Crude oil futures for May expired at $10.01 a barrel, rising $47.64, or about 127% from Monday’s close of -$37.63 a barrel.

WTI crude oil futures for June contract settled with a loss of $8.66, or about 43%, at $11.57 a barrel today, recording the lowest close for most-active contracts in over 21 years.

Brent crude for June ended down $6.24, or about 24%, at $19.33 a barrel, posting the biggest loss in percentage terms since January 1991.

“Worldwide available capacity that is not in maintenance is almost all gone and from what I hear elsewhere in the world we’re not the only ones,” the Bloomberg quoted the chief financial officer of Rotterdam-based Royal Vopak NV as saying in an interview.

According to the International Energy Agency, demand in April is estimated to be 29 million barrels/day lower than a year ago, down to a level last seen in 1995.

U.S. President Donald Trump told reporters at a news conference on Monday that his administration was considering the possibility of stopping incoming Saudi Arabian crude oil shipments as a measure to support the battered domestic drilling industry.

A lot of U.S. shale producers are in deep trouble and analysts expect that low oil price for few more months will result in a spate of bankruptcies in the country.

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