Oil rebounds from record wipeout with prices edging above zero

Oil rebounded in Asian trading, after plunging below zero for the first time in history amid rapidly filling American storage tanks, as the U.S. benchmarks May contract entered its final trading session.

Futures in New York traded at around $2 a barrel after sinking to as low as minus $40.32 during Mondays jaw-dropping collapse. The June contract, however, which had trading volumes more than 40 times higher, rose past $22. The spread between the two reflects the growing fear that those who take physical delivery of crude in the near future may not find any outlet or storage for those barrels as refineries curb operations.

With the coronavirus pandemic bringing the U.S. and much of the global economy to a standstill, processors are using far less crude, leaving so much unused oil sloshing around that American energy companies are running out of room to store it. And if there’s no place to put the oil, nobody wants a crude contract that is about to come due.