The deal that Donald Trump cut only delayed the inevitable. A raging price war in the middle of a pandemic rapidly filled storage capacity for oil production around the world, even before the coronavirus pandemic began impacting demand. With most of the planet on some form of self-imposed economic stall to keep the COVID-19 plague from spreading further, demand won’t recover for weeks, if not months.
With that reality staring investors in the face, they have responded to the lack of capacity and low demand by rationally deciding not to go long on oil futures. This is what that looks like today:
— Joe Weisenthal (@TheStalwart) April 20, 2020