Crude oil prices were down on Thursday amid worries that the rising glut of supply in the global oil market would rapidly fill crude storage capacity around the world.
International benchmark Brent crude was trading at $19.20 per barrel at 0625 GMT for a 4% decline after it closed Monday at $20 a barrel.
American benchmark West Texas Intermediate was at $17.96 a barrel at the same time for a 28.8% dive after ending the previous session at $12.78 per barrel.
Due to the novel coronavirus (COVID-19), global oil demand has been low, but supply has been growing since oil producers around the world continue to keep pumping crude.
Saudi Arabia-led OPEC and Russia-led non-OPEC oil producing nations agreed on April 12 to lower their collective crude production by 9.7 million barrels per day (bpd) starting from May 1.
However, since the 23-nation group, known as OPEC+, has not provided any output cut for the month of April, the glut of supply is rising and storage capacity for crude oil has been in steady decline.
In the US, oil storage in Cushing, Oklahoma, shows that around 60 million barrels of oil are in inventory out of some 90 million barrels of capacity.
With an extra weekly supply of 16 million barrels of oil coming into storage every week, the region known as the heart of the US’ oil pipeline network could soon run out of available capacity at the beginning of May.
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