For the future of the oil industry, the Coronavirus pandemic is a key concern.
Fears of low demand increase, as Coronavirus sets new records across the world. It is though unclear what will come next. To better predict the future of the world’s economic growth, it is vital to have an updated understanding of the coronavirus’s impact on the oil industry.
That’s why we created a brief history of what has happened to oil prices during the Coronavirus pandemic in our newest video.
In this video, we show how the world’s economy has been affected by the outbreak of Coronavirus.
As you may know, in the first weeks of the crisis, the Coronavirus outbreak led to huge losses in demands and sent the oil prices down. This was the result of the closure of ports in different countries and a sharp decline in fuel consumption.
Things went worse and in some parts of the United States, where demand was lower than oil supply, the prices dropped below zero (for just one day). Since oil extraction is not controllable, production remained the same as before the crisis, but demands declined significantly.
In the second part of the video, we take a look at Brent crude oil prices during the pandemic.
Before Coronavirus pandemic, the outlook of Brent crude oil was positive in the first days of 2020. Prices rose to their highest level, reaching $70 in January 6.
However, with the spread of the Coronavirus beyond Asia, as well as the closure of oil importing countries’ borders, Brent crude oil hit $35 on March 9. As oil demands declined, due to Covid-19, Brent crude oil went down to $9 on April 21.
West Texas Intermediate crude was not different. On January 6, WTI reached $63, which was the highest price in the current year. By Covid-19 spreading all over the world, WTI dropped 28% to $32 a barrel on March 9 and marked its sharpest decline, when it hit $11 on April 21, 2020.
In the final part of our video, we consider OPEC’s oil price losing its value during the Coronavirus outbreak. The OPEC’s highest oil price in 2020 was recorded on January 6 at $70. As demands declined due to Covid-19, the prices declined to $37 on March 10. The lowest price for this oil was $12 on April 22.
