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Oil prices crashed into -ve! What's the whole thing behind this?

Hello guys! Welcome to CarsReboot! Today the topic of discussion is the 'Declining oil prices'. Even though the topic shouldn't be discussed in a blog which primarily talks completely about cars, I decided to post it on behalf of increasing questions in this particular topic on my Quora profile. 

Ok! Enough of intro and now into the topic.
 Some days back itself the news had came that crude oil companies are facing the steep decline in the demand for oil and also many traders have reduced importing of oil to their countries. The Price of per gallon oil was at 60$ before and at the start it fell into 30$, later it went down to 26.64$ and continued to decrease and now it even went to -ve.


Why this condition occurred? 
As Everyone knows the fact that every country throughout the world is facing the COVID-19 very badly and also due to the continuous lockdowns happening in every country, the oil which was in reserves in every country itself has become bottle-neck and was unsold. This Condition occurred due to the companies, traders who associated with the process of oil importing has already bought so much of oil thinking that in future there might be increase in oil prices and keeping this thought those traders and companies(refineries) have ordered the crude oil barrels for future too.

Now, the major players who have seen high losses are the refineries, traders and also the investors who invested in this category. People who took long positions means who ordered the barrels have to rollover the date from 2020 may to june and it might continue until they sell at least half the current oil reserves. India is also the facing the same situation and is continuing but what's ironic is that even though the crude oil companies are facing the high decline in demand throughout, the prices of diesel and petrol in India continue to stand at 62.29Rs/lit and 69.59/lit. Many market analysts who work in these type of industries are stating that these kind of situations occur very rarely but if they occur, then the revival of that industries will take so much time to work in full house.

Now, due to the out break of COVID-19 virus from China, every country has lost economy so brutal and India'a condition is even worse. As of now we have lost around 7% of our GDP which is at 15Lakh crores while the overall GDP our our country stands at 200Lakhs of crores. So, for every day we have lost around some 3,800 Crores and the Central govt is trying all their possible tricks and tweaks to revive it but not working it seems due to the effect of virus in many areas of India.
The Information which I have provided above is the one which I have cime across and this is only till today i.e,   22 April 2020 and the condition could go worse if this condition continues.

Thank you for reading this post and see you in the next one.


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