Oil prices slumped again recently amid concern about dwindling capacity to store crude worldwide, heightened by fears that fuel demand may be slow to pick up once countries ease curbs imposed on business and social life to combat the coronavirus pandemic.
US West Texas Intermediate (WTI) crude CLc1 futures fell to as little as $10.64 a barrel on Tuesday, and were off 12.8%, or $1.64, at $11.14 a barrel as of 0635 GMT. WTI plunged 25% recently.
Brent crude LCOc1 futures fell to a low of $18.85 and were last down 4.3%, or 85 cents, at $19.14 a barrel. The benchmark slid 6.8% on Monday, and the contract for June delivery expires on April 30.
Strategists said part of the WTI decline is due to retail investment vehicles like exchange-traded funds selling out of the front-month June contract and buying into months later in the year to avert massive losses like last week, when WTI plummeted below zero.
The United States Oil Fund LP (USO), the largest oil-focused US exchange-traded product, said it would further shift its holdings into later-dated contracts.
"With the USO ETF due to continuing selling down its June WTI position for the rest of the week, nobody else who needs to, or wants to sell, is hanging around and waiting for them to do so," said Jeffrey Halley, senior market analyst at OANDA brokerage in Singapore.