US oil prices drop below zero for the first time in history
Producers forced to pay $37.63 per barrel to clear off excess stockpiles as demand dries up amid coronavirus lockdown
Wall Street fell sharply on Monday after US crude futures turned negative for the first time in history, underscoring the chaos the coronavirus pandemic has unleashed on the global economy.
The S&P energy index tumbled 2.8% after the front-month May U.S. West Texas Intermediate (WTI) contract turned negative - unprecedented in history - with sellers offering buyers $37.63 a barrel.
With much of the global economy suspended due to the coronavirus, physical demand for crude has dried up, creating a global supply glut as billions of people stay home.
"Oil down is normally good for the rest of the sectors, but you can make the argument that it is so low that it's not good for anybody in terms of what it's going to do to unemployment and economic growth," said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.
At 2:26 pm ET, the Dow Jones Industrial Average was down 1.79% at 23,807.69 points, while the S&P 500 lost 1.27% to 2,838.15.