The rapid collapse of U.S. oil futures on Monday caused crude’s premium over natural gas to turn into a deficit for the first time ever.
If it holds, that could prompt producers to search for gas instead of oil in future months – especially if gas demand recovers as expected when the economy snaps back after governments loosen travel restrictions once the coronavirus spread slows.
For now, however, both oil and gas prices have plunged as the coronavirus causes energy demand to vanish as offices close and factories run at reduced capacities.
Since the start of the year, U.S. crude futures have tumbled over 150% to a record low below minus $37 a barrel due to the combined impact of coronavirus demand destruction and a price war between Saudi Arabia and Russia.