Oil price crash is perfectly rational, investor Howard Marks says - Business Insider

and the reduction in demand for the commodity during the ongoing coronavirus pandemic has tanked prices in recent days.

Negative US oil prices, the lowest international oil prices since 1999 and no place to store oil has spooked investors across both sides of the Atlantic, but one billionaire investor thinks it is no big deal. on Wednesday: "It's not a panic. The move is completely rational." US oil prices turned negative for the first time in history

Marks pointed out that the lack of storage for oil has caused the crash rather than weakening fundamentals. The WTI May contract fell as low a -$40.32 a barrel, meaning traders had to pay others to take the contracts off their hands. hitting a low of $15.99 per barrel early in trading. It has since rebounded to positive territory but remains near multi-decade lows at $19.63 as of 7.00 a.m. ET.

I’d agree with that. When the US became an exporter, thought that would do it but no. When Aramco IPO’d, then I thought definitely but no again. But now, because people didn’t want to take physical delivery in May the price tanks. Fundamental fuses need a flash catalyst to light

It's a rational crash

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