In a historic event, the prices of West Texas crude Intermediate oil (WTI) fell below zero dollars per barrel. In fact, at the lowest, WTI closed on the NYMEX at -37.63 dollars per barrel which means the production companies have to pay the storage and distribution companies for buying up oil, and that too 37.63 dollars for a barrel.
This is a historic event, as in modern history, especially after 1950s when oil became new gold; WTI has never traded at such low prices. In fact, In the 21st century, it traded above 100 dollars per barrel for a fairly large amount of time, bringing major problems for oil-importing countries.
This is a notable moment in the history of commodity prices. This would be a defining movement in fossil fuel-based energy generation, too. As of now, more than 80 percent of global energy demand is met through fossil fuel- oil, gas, and coal- and the countries around the world were pushing for clean energy to save the environment and get rid of costly fossil fuel. But with such historic low prices of oil, the whole momentum built-in clean energy sector is going to collapse.
The historic low prices of WTI crude will not majorly benefit India, at least as of now. Because India is primarily dependent on Brent crude, international benchmark price used by OPEC countries- India imports almost 80 percent of its total demand- is still trading at around 25 dollar per barrel.
The prices of WTI crude, which is primarily produced in United States and Canada, collapsed in the negative territory due to shortage of storage facilities. The tankers and reservoirs of the US and Canada are full while the economy is at a halt due to Coronavirus disease which results in no demand for oil, and therefore, the prices collapsed. The prices are so low that US President Donald Trump decided to fill up the strategic reserves despite the faltering economy.
On the other hand, Brent crude, which is primarily used in Asia and Europe, is trading at a fair price, thanks to reservoirs in Asian countries. Although, with the fall in WTI crude, the prices of Brent would also register decline ultimately as many countries which are major importers of crude, would witness a decline in demand owing to COVID-19 lockdowns.
However, the historic fall in WTI crude oil prices has exposed the low-IQ driven left-liberal intelligentsia. As the price fell below zero, the people from the establishment started peddling the narrative that the Modi government is not reducing the prices of Petrol and diesel, ignorant of the fact that India is largely dependent on Brent crude oil and not WTI.
“Will the shameless government that has milked the public with extortionate fuel taxes for six years finally relent and pass some of this windfall onto the beleaguered Indian consumer?” tweeted Shashi Tharoor, the presiding deity of left-liberal intellectuals.
Will the shameless government that has milked the public with extortionate fuel taxes for six years finally relent and pass some of this windfall onto the beleaguered Indian consumer? pic.twitter.com/zEJIQIGYfn
— Shashi Tharoor (@ShashiTharoor) April 20, 2020
“The prices of Petrol and diesel prices in the International market has gone below zero, then why it is costly in India,” questioned Ashutosh, journalist, and former AAP member.
कोरोना का करिश्मा: पेट्रोल-डीज़ल के दाम शून्य से भी नीचे!
तो फिर भारत में मंहगा क्यों ? #कोरोना_पोजेटिव #कोरोना_वारियर्स #कोरोना #CoronaUpdatesInIndia #COVIDー19 #Coronaindia #corona #petrolPrice https://t.co/8K3H1dmxYE
— ashutosh (@ashutosh83B) April 21, 2020
Oil prices are MINUS $37. This means oil is just not free, the oil producer will pay you $37/ barrel with free oil. But, in INDIA petrol/diesel prices are one of the HIGHEST IN HISTORY !
SabKa Saath, Sabka vikas? What a JUMLA!!!https://t.co/kMJx1KY1wf
— Krishna Byre Gowda (@krishnabgowda) April 21, 2020
The fall in WTI crude prices has exposed the ignorance of left-liberal establishment who cannot differentiate between two varieties of crude oil. Most of the opposition leaders are asking the same question- why has Modi government kept prices in domestic markets so high despite the fact that international market price has gone in negative territory?
Whole left-liberal intelligentsia got exposed with fall of WTI crude prices below zero.
I mean none of them, from @ShashiTharoor to @ashutosh83B is being able to differentiate between –
WTI Crude and Brent Crude.
Also known as American oil and Saudi oil.
Such Morons!!
— Amit Agrahari (@Amit_Agrahari94) April 21, 2020
Apart from getting sad or angry over the ignorance of the opposition and left-liberal establishment, this is historic moment for the global economy; commodity trading; and good news for India.
