Apr 20, 2020

Axios PM

Good afternoon: Today's PM — edited by Justin Green — is 595 words, a 2.2-minute read.

Situational awareness: ESPN's "The Last Dance" documentary on the Chicago Bulls’ 1998 NBA championship run averaged a record-breaking 6.1 million viewers last night.

1 big thing: 🛢 makes history

Today was such a bad day for oil that producers had to pay to sell their own crude.

Screenshot: Fox Business

The state of play: Futures prices for West Texas Intermediate are deep in negative terrain after settling at -$37.63 on NYMEX, Axios' Ben Geman reports.

  • The unprecedented negative pricing for May futures is also related to timing because the June contract is trading at far higher (albeit still dirt-cheap) levels in the roughly $21 range.

The big picture: The coronavirus-fueled lockdowns around the world are choking off oil demand and throwing the oil industry — which was already oversupplied before the pandemic — into historic chaos, Axios' Amy Harder writes.

  • An equally historic production cut of the world’s biggest producers likely delayed the drop in oil prices we’re seeing today — and made it a tiny bit less bad.
  • Prices are likely to keep dropping, or at the very least remain very low, for the next few weeks or so, given that there simply are not enough places to store all of the extra oil sloshing around the world as many of us stay at home.

The other side: Progressive lawmakers and environmentalists are seizing on a beleaguered industry as a sign its days are past and renewables are the future.

  • Rep. Alexandria Ocasio Cortez tweeted: "This snapshot is being acknowledged as a turning point in the climate movement."
  • "Fossil fuels are in long-term structural decline. This along w/ low interest rates means it‘s the right time to create millions of jobs transitioning to renewable and clean energy."

Between the lines: It may seem crazy, but this might not make much difference in your gas prices.

  • The way the global oil market works and prices oil into the future, this foray into negative territory is very unlikely to have an impact on domestic gas prices, Patrick De Haan, head of petroleum analysis at GasBuddy, told Amy.
  • The prices that went negative were WTI — the U.S.-based benchmark. Brent prices, based in Europe, are still hovering around $30 a barrel, a relatively high price.
  • The national gas average is $1.80, per AAA, but several states have prices significantly lower, GasBuddy writes.

What's next: Consultancy Rystad Energy is predicting dozens of U.S.-based oil companies will declare bankruptcy over the next several months to a year.

  • President Trump will likely face new pressure to take whatever action he can — like tariffs on oil imports — to throw whatever lifeline he can to the struggling sector.
Bonus: Pic du jour
Photo: Lintao Zhang/Getty Images

Commuters wear protective masks as they exit a train at a subway station during rush hour in Beijing, China.

  • Life in Beijing is slowly returning to normal following a citywide lockdown on Jan. 25.
2. Catch up quick

Photo: Andrew Vaughan/The Canadian Press

  1. Canada shooting update: Royal Canadian Mounted Police say "at least 19 people are dead after a lone gunman's rampage, leaving families and communities across Nova Scotia devastated."
  2. Business update: JBS shuts down Minnesota pork plant due to coronavirus outbreak.
  3. States latest: Maryland to receive 500,000 coronavirus tests from South Korea — Cuomo predicts 20% cuts to New York's schools and hospitals without federal relief.
  4. 🎧 Podcast: Shake Shack founder on returning $10 million PPP loan.
3. 1 helpful thing

In times of crisis, Americans are quick to look for how they can help, according to a WashPost analysis of Google Trends data. 

  • Why it matters: There have been more people googling “how can I help” in the past few months than at any other point since 2004 — as far back as Google Trends’ data goes, Axios' Stef Kight notes.

Google searches for “how can I help” spiked around the same time as the wildfires in Australia earlier this year, the immigrant family separation crisis in 2018, Hurricane Harvey in 2017, the Fukushima nuclear disaster in 2011, the Haiti earthquake in 2010 and Hurricane Katrina in 2005.