Related: OPEC Oil Supply Cut Could Prompt Higher Fuel Prices
Pandemic Drop in Fuel Demand Triggers Historic Low Oil Futures
After West Texas International (WTI) crude prices almost ended last week with historic low of $17.31 per barrel before eventually settling at $18.27, the benchmark price for crude oil in the U.S. dropped to negative $37.63 late Monday.

The Cushing, Oklahoma, oil storage facility, the largest in the country, its reaching its limit.
Source: HFI Research/EIA
Crude oil futures for May delivery hit negative territory late Monday for the first time in history, then June futures dropped to $10 per barrel Tuesday, as the COVID-19 pandemic and a failure among oil-producing countries to cut production has led to a glut of crude oil.
After West Texas International (WTI) crude prices nearly hit a historic low of $17.31 per barrel late last week before eventually settling at $18.27, the benchmark price for crude oil in the U.S. dropped to negative $37.63 late Monday as May futures neared expiration, "leaving traders in a panic as they tried to avoid taking delivery of physical barrels," Bloomberg noted.
"A negative price for a futures contract is essentially an individual oil trader offering to pay another party to take the oil off their hands," wrote Mark Green with the American Petroleum Institute in a blog post. "No question, futures contracts are a clear sign of continued challenges for the energy industry."
While API and others credited a "technical oddity" having to do with paper contracts as one reason for the negative crude oil trading numbers, there's no denying that demand for diesel and gasoline has plummeted under stay-at-home orders. The issue leads back to the lack of storage space for the oil that is currently being produced in the U.S., according to a recent New York Time article. With people traveling less and less, the daily consumption of gas and diesel has dropped significantly, keeping the storage tanks filled.
WTI stores its crude oil in Cushing, Oklahoma, the largest oil storage facility in the country. The site is reaching capacity, which affects the future price of oil since there is no immediate storage, distribution or use of it, according to HFI Research and EIA. This could actually lead to traders to pay buyers to take the oil.
Some people are wondering why diesel prices haven't dropped more. The national average retail price of a gallon of diesel dropped to 2.48 last week, according to an April 20 report from the U.S. Energy Information Administration. That's down 2.7 cents a gallon from the previous week and 6.7 cents a gallon from a year ago. The cost of crude oil only makes up about 29% of the price of diesel as of March, according to EIA. With low demand, some refineries that turn crude oil into gasoline, diesel, jet fuel, and the like are idled or operating below capacity.
Even with OPEC and allies agreeing to drop oil production starting in May, the effort was not enough to fend off the effects of the global surplus and dropping prices. In a recent move, Saudi Arabia, which agreed to cut down production from 12.3 million barrels a day in early April to 8.5 million barrels a day beginning in May, has stated it could start the cuts immediately.
President Trump tweeted on April 21 that he was asking administration officials to “formulate a plan that will make funds available” to help the oil and gas industry, adding that he asked Congress for $3 billion to purchase oil for the Strategic Petroleum Reserve that wasn't included in stimulus package.
More Fuel Smarts

Cummins Adjusts 2027 Engine Rollout After EPA Proposal
The engine maker will gradually introduce its new Model Year 2027 diesel engines while continuing to offer current models during the transition, citing the EPA's proposed emissions rule changes.
Read More →
EPA Proposal Could Ease 2027 Truck Costs and Buying Uncertainty
The proposal doesn't change the tougher NOx standard, but it would revise key implementation requirements that manufacturers say have driven up costs and complicated fleet purchasing decisions.
Read More →
Cummins, Paccar Ease DEF Derates After EPA Guidance
Updated diesel engine software gives truck operators more time to address emissions-system issues while staying compliant with EPA emissions standards.
Read More →
Maintenance in the Messy Middle Part 3: Biodiesel
Biodiesel can reduce emissions, improve fuel-system lubricity and use existing diesel infrastructure. But NACFE’s Messy Middle maintenance report says fleets must actively manage storage, cold-weather operation, filters and oil drain intervals to avoid problems.
Read More →
Enhance Fleet Performance with High-Efficiency Auxiliary Power Units
Drive sustainable cost savings while increasing driver comfort during short- and long-haul logistics operations.
Read More →
Maintenance in the ‘Messy Middle’ Part 2: Renewable Diesel Fuel
NACFE's latest Messy Middle Powertrain Service & Maintenance report says renewable diesel gives fleets an opportunity to reduce carbon emissions without changing trucks, fueling infrastructure or maintenance practices. But technicians still need to understand several important operational differences.
Read More →
The Diesel Engine Enters NACFE’s ‘Messy Middle’
NACFE’s new Messy Middle Powertrain Service & Maintenance report says keeping modern diesel engines running now depends as much on software, diagnostics and data as traditional mechanical service.
Read More →
DTNA Software Update Gives Truckers More Time Before DEF Derates Take Effect
The changes reflect EPA guidance aimed at reducing downtime caused by emissions-system faults while maintaining compliance requirements.
Read More →
New Agentic Predictive Maintenance Report Demonstrates How Degraded Aftertreatment Systems Waste Fuel
Questar analyzed a large mixed-class fleet and discovered it was wasting as much as $30 in fuel per vehicle, per day, because of mechanically degraded aftertreatment systems.
Read More →
New York City's Microhub Project is Delivering Results
Trucking, last-mile delivery companies, and environmental advocates like what they are seeing so far with New York's microhub program.
Read More →
