The collapse follows a historic rout on Monday when US oil for May delivery traded at negative prices as the combination of evaporating demand due to the pandemic, oversupply and a critical lack of storage for excess barrels saw traders effectively paying people to take American crude off their hands.
Brent crashed as low as $15.98 a barrel, before steadying to trade around $17.30, still down more than 10%.
The market is worried about oil hubs running out of room to store barrels that nobody wants as the coronavirus pandemic causes demand for crude to disappear. While Saudi Arabia and Russia recently reached a deal with other members of the OPEC+ alliance to cut supply from May 1 by a record amount, that has done little to alleviate fears.
“Oil futures prices should turn around once demand picks up for the physical product but that looks a couple of months away,” wrote Jasper Lawler, head of research at London Capital Group.
“Panic is spreading not only among oil traders but also within OPEC+, prompting it to conduct an emergency conference call yesterday, though no new strategic consensus has been reached as yet,” wrote Eugen Weinberg, head of commodities research at Commerzbank, in a note to clients on Wednesday.
Subscriber gains were propelled in part by coronavirus stay-at-home orders and popular Netflix releases such as reality dating show “Love is Blind” and docu-series “Tiger King.”
— Julia Horowitz, Anneken Tappe and Frank Pallotta contributed to this report.