Global oil prices continue to be in a tailspin amid nationwide lockdowns to stop the coronavirus (COVID-19) pandemic and a deluge of production from Saudi Arabia and Russia. With a slowing world economy, the West Texas Intermediate (WTI) touched recent record low of $21.51 per barrel on Friday, while the international benchmark Brent traded at $27.95 per barrel, far below the highs of $147 per barrel of July 2008.
Pipeline operators may seek legal protection as pandemic causes oil demand to plummet rapidly falling demand for crude oil amid the coronavirus pandemic may soon have pipeline operators with full storage tanks seeking legal protection for events out of their control.
The global oil market is broken, overwhelmed by an unmanageable surplus as virus lockdowns cascade through the world’s largest economies. Onshore tanks in many markets are full, forcing traders to store excess oil in idle supertankers. Refineries are starting to shut down because nobody needs the fuels they produce. In physical oil markets, barrels are already changing hands for less than $10, and in a few landlocked markets producers are paying consumers to take away their crude.