Amidst the COVID-19 pandemic, global oil demand has fallen off a cliff in the last month as a combination of factors drive supply exponentially higher than current demand.
In the U.S., oil wells are closing in historic numbers due to a surplus in supply. The oil price gauge per barrel the U.S. uses is just slightly above $20, driven by a sharp decline in oil consumption and an ongoing battle between the world’s largest producers. Prices were already relatively low at around $60 a barrel to begin the year.
Consumption of oil in the U.S. fell to under 15 million barrels a day and doesn’t look to be slowing down anytime soon. Because of this, major oil companies in the U.S. and abroad have already made spending cuts in the tens of billions. Production and spending cuts in Canada have been even harsher.
