The coronavirus pandemic has hit the US oil industry particularly hard.
Oil prices have not been this low in history, and are forcing businesses and companies to file for bankruptcy, reports CNN.
Demand has plummeted as lockdowns and travel restrictions reduce the need for oil.
Oil demand to drop so rapidly that the world is running out of room to store barrels. At the same time, Russia and Saudi Arabia flooded the world with excess supply.
Investors sold the May futures contract due to expire on Tuesday in a series of waves. At one point the contract hit negative $40. When the trading stopped, crude oil had ended the day at a negative $37.63 a barrel, a decline of some 305%, or $55.90 a barrel.
For as sudden as the day's declines were, it was weeks in the making.
That unwanted oil is instead going into storage, but in the United States, storage is filling much more quickly than anticipated.
Cushing, Oklahoma, the tiny town of less than 10,000 people that serves as the main US storage hub, was 70% full as of last week, and traders say it will be full within two weeks.
Analysts say this type of market dislocations could recur in coming months because fuel supply will outweigh fuel demand for the foreseeable future.
Worldwide oil consumption is roughly 100 million barrels a day, but consumption fell by 30% globally, or about 30 million bpd, beginning in early March.
However, it took the Organization of the Petroleum Exporting Countries, Russia and other countries until early April to agree to cut supply by 9.7 million bpd.
Other nations, like the United States and Canada, did not mandate cuts from private industry, but those companies are swiftly reducing output.
US crude for June delivery is still trading above $20 a barrel — but even that's disastrous. "$30 is already quite bad, but once you get to $20 or even $10, it's a complete nightmare," said Artem Abramov, head of shale research at Rystad Energy.
Many oil companies took on too much debt during the good times. Some of them won't be able to survive this historic downturn.
In a $20 oil environment, 533 US oil exploration and production companies will file for bankruptcy by the end of 2021, according to Rystad Energy.
At $10, there would be more than 1,100 bankruptcies, Rystad estimates.
"At $10, almost every US E&P company that has debt will have to file Chapter 11 or consider strategic opportunities," Abramov said.