Oil price briefly fell below zero, now a barrel costs 1 US dollar

SARAJEVO, (Patria) - The price of oil fell today to its lowest level in trading history, due to a sell-off on world markets fueled by uncertainty about storage capacity for oil that cannot currently be sold.

Namely, demand for crude oil has dramatically decreased due to the freezing of economic activity in a number of countries due to the coronavirus pandemic, reports Index.hr, citing foreign media.

The price of the benchmark US oil brand West Texas Intermediate (WTI) first fell earlier today by 50%, to an amount of only $9 per barrel, which is the lowest price since 1998 and the largest daily drop since 1982, reports the American portal Business Insider.

But in the meantime, the fall continued further, so WTI at one point fell below 5 dollars, then even below three dollars per barrel. This meant a drop of as much as 84%, to the lowest level since the beginning of trading so-called futures contracts for the purchase of this oil brand. Trading began in 1983.

The average price of WTI crude oil per barrel was $57 in 2019, and $64 in 2018.

However, the price continued to fall unstoppably until it reached zero, and at one point it even fell below zero, to a negative price, CNN reports.

In the meantime, it has "recovered" and currently stands at - one US cent per barrel, as can be seen on the market tracking and analysis website DailyFX. This represents a price drop of an surreal 99.95%.

The British benchmark oil brand Brent Crude had a much smaller drop of 6.6%, to an amount of $26.23 per barrel at its lowest point. It is currently still stable at that price.