TORONTO – The price for North American oil is taking an unprecedented nose dive.
West Texas Intermediate (WTI), the North American Benchmark, has fallen into the negatives in trading on the May contract.
Overnight, Western Canadian Select (WCS) was below zero at one point but has recovered to around $8 a barrel.
The price for oil has gone negative for the first time ever. -$1.43, down 106% on the May contract.
— Richard Southern (@richard680news) April 20, 2020
Meanwhile, the June WTI contract is set to kick in later this week, and it’s currently at $22 a barrel.
Companies including Husky, Crescent Point Energy and Cathedral are slashing spending as more oil builds up in storage.
Although OPEC reached a deal to cut production, that’s not set to kick in until May and storage facilities in North America are now nearing capacity.
Alberta Premier Jason Kenney took to Twitter pleading with the federal government to do even more to help the oil patch, after the Prime Minister announced $1.7 billion to keep workers employed cleaning up orphaned and abandoned wells.
Alberta NDP Leader Rachel Notley responded by saying in a statement that Kenney can’t keep waiting for federal support.
“The premier keeps pointing the finger at Ottawa, but waiting for Justin Trudeau is not a strategy,” Notley said.
“Alberta will need bold action and new ideas to secure our energy future and diversify our economy for generations to come. So far, Jason Kenney and the UCP have proven incapable of showing any kind of vision for the future of our province,” she added.
-with files from the Canadian Press.