US Oil Falls below $11 a Barrel as Supply Concerns Keep Roiling Markets

By Staff, CNN

US oil prices are still plunging as investors continue to fret about an excess supply of crude at a time when no one wants any.

West Texas Intermediate plummeted more than 14% to $10.95 during Asian trading hours Tuesday, accelerating earlier, dramatic declines. The US benchmark, of oil to be delivered in June, settled at $12.78 a barrel on Monday — a drop of more than 20%.

The latest crash came as the United States Oil Fund — a popular fund geared to track the price of oil — said in a regulatory filing that it would dump its June oil contracts this week and reduce contracts for other upcoming months. Instead, the ETF will buy into longer-term oil contracts.

The announcement was yet another sign of how much the coronavirus pandemic has caused oil demand to evaporate, leaving the world without much room to store barrels of excess supply that aren't being used.

US oil experienced a stunning collapse last week when futures for May delivery traded well below $0 a barrel. Since then, that contract has expired and investors are now trading on the June contract. But now that price is in danger of slipping below $10.

Brent crude also fell Tuesday. The global benchmark was last down 5% to $18.96 a barrel.