US oil industry is moving towards its decline since the pandemic of Coronavirus has created a drop in demand for oil so rapidly. Where as Russia and Saudi Arabia has served the world with too much of its supply. The fast decrease in market of these weeks had crossed peak on Monday as supplies has reached last day to supply oil to deliver in May before ending of the contracts.
As many of the companies has taken so much of debits in the stable financial period that the survival of some of them during this setback of economy.
The oil markets with weaker economy might lower the prices for drivers working at service station, but this price downfall will also affect savings which are mostly invested in big oil companies by the capital which chase stock markets. The crisis in the oil price has already cleared billions out of the market value of the great oil companies, many of which might not be capable to pay if the market dispel drags on.
Since the people are kept inside the homes due to the lockdown the usage of oil has come to an end and thus the demand is also less.An energy equity analyst Glick man said, “the historic reversal in pricing was a reminder of the stress facing the oil market and warned that June prices could also fall, if lockdowns remain in place.”I’m really not optimistic about the prospects for oil companies or oil prices”. There are around 500 Standard and Poor energy companies that hold large share of market.
Several analysts have notified that the variations that have encountered in the stock are because of the expectations the economic will spin and will reassemble it once this lockdown period is over.
