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

How Volvo Updated Its D13 for EPA 2027 [Watch]
Volvo’s updated D13 promises lower emissions without sacrificing performance or fuel economy. Take a closer look at what changed inside the engine in this HDT Spotlight video.
Read More →
Diesel Price Spike Shortens Payback for Natural Gas Trucks, Report Says
Energy Vision estimates fleets could recover the higher purchase price of an RNG-fueled Class 8 tractor in 1.3 to 2.8 years under current fuel-price scenarios.
Read More →
Calstart Becomes Catalyst Mobility, Reflecting Broader Focus
Calstart is now Catalyst Mobility, reflecting the nonprofit’s growing national role in clean transportation, including zero-emission trucks, infrastructure and incentive programs.
Read More →
Record Diesel Prices Squeeze Trucking Fleets
Average U.S. diesel prices have climbed to nearly $6 a gallon, surpassing the 2022 record as tight refinery capacity and Middle East disruptions keep fuel costs elevated.
Read More →
How Fuel Delivery Shapes Engine Performance
Fuel delivery depends on more than what happens at the injector. For fleet, maintenance and technical professionals, looking at the full path from pump to injector can provide useful context for understanding engine performance.
Read More →
East Coast Port Launches $45M Electric Truck Push
The Port Authority of New York and New Jersey announced millions in incentives for zero-emission drayage trucks, yard tractors, and new charging hubs near the port.
Read More →
California Bill Could Shed Light on Electric Truck Prices
Why do battery-electric Class 8 trucks remain so expensive? A California bill headed to Gov. Gavin Newsom would give fleets and state agencies more visibility into what manufacturers charge.
Read More →
Detroit Opens Orders for EPA 2027 Engines
Detroit isn’t starting from scratch to meet EPA 2027 diesel emissions standards. Its Gen 6 DD13 and DD15 engines keep much of today’s platform while updating the fuel and aftertreatment systems.
Read More →
Zero-Emission Truck Corridor Planned for West Coast
California, Oregon, Washington, British Columbia and Baja California are coordinating plans for truck charging and hydrogen fueling from Canada to Mexico.
Read More →A Closer Look at Kenworth’s Electric T880E Vocational Truck [Video]
Learn more about Kenworth's T880E battery-electric vocational truck at the Paccar Technical Center, including its range, applications, upfitting considerations, and PTO options, in this HDT Spotlight video.
Read More →

