US oil held its free fall on Tuesday in the Asian market, where a barrel was below $ 11, after a major exchange-traded fund began selling its short-term contracts.
WTI’s barrel, the US benchmark, for June delivery fell 14.8% at the opening of the Asian market, to $ 10.88 per barrel, a day after falling 25%.
Meanwhile, the barrel of Brent, the European benchmark, fell 4.4% to trade at $ 19.10 per barrel.
International crude oil prices have collapsed in recent weeks due to the dramatic drop in demand as a result of the confinement of people and travel restrictions imposed around the world to combat the pandemic of the new coronavirus.
Last week, US oil fell below zero for the first time when investors rushed to unload it before the expiration of a trade contract, but were unable to find buyers easily.
Prices have since recovered, but remain at their lowest levels in many years.
Continuing concerns about storage overshadowed signs that some countries, including Kuwait and Algeria, began to cut production in line with a major deal reached this month.
This latest drop is a reaction to the United States Oil Fund group’s decision to sell all of its positions in WTI contracts for June delivery.
By investing in longer-term contracts, the move ended up deepening pressures on June contracts, analysts said.
The move highlights continuing concerns about saturation of storage capacity, leaving buyers faced with the difficulty of finding space to accumulate reserves.