HOUSTON, Texas — The U.S oil industry took a major hit Monday as prices crashed to historic lows.
But what’s bad for business may be better news for drivers at the gas pump.
"The price of crude has dropped dramatically,” said University of Houston Energy Fellow and economics professor Ed Hirs.
Hirs blamed the drop on the global impact of the COVID-19 crisis and the way Wall Street invests in crude oil.
"The price of oil actually could fall even more between today and the close of market tomorrow,” Hirs said.
The main U.S. industry benchmark, known as the West Texas Intermediate, dropped throughout the day and dipped below $0 per barrel for the first time ever.
It’s all happening as oil-producing countries and companies try to reduce output.
However, they can’t really keep up with the exceedingly rapid drop in demand.
And while Hirs said big energy companies with major ties to Houston would feel a significant impact, oil fields in West Texas and elsewhere will be hardest hit.
Many oil service workers in those areas have already been laid off.
"It’s just not very good, and it’s going to continue this way until we get out of the COVID-19 recession,” said Hirs.
He said oil producers could potentially even pay consumers to take the crude. IT has happened in the field on some occasions, including in 2008. But it's never before happened on the New York Mercantile Exchange for oil.
He also said consumers will continue to see lower prices at the pump -- but that’s a mixed blessing.
"The problem with consumers benefiting from this is there’s no place to go," said Hirs. "We’re not going on vacations, hotels are closed, we’re not even driving to work.”
He stresses it's still no time for panic as virtually every sector feels the impact of the COVID-19 crisis, not just oil and gas.
Coronavirus symptoms
The symptoms of coronavirus can be similar to the flu or a bad cold. Symptoms include a fever, cough and shortness of breath, according to the Centers for Disease Control. Some patients also have nausea, body aches, headaches and stomach issues. Losing your sense of taste and/or smell can also be an early warning sign.
Most healthy people will have mild symptoms. A study of more than 72,000 patients by the Centers for Disease Control in China showed 80 percent of the cases there were mild.
But infections can cause pneumonia, severe acute respiratory syndrome, kidney failure and even death, according to the World Health Organization. Older people with underlying health conditions are most at risk for becoming seriously ill. However, U.S. experts are seeing a significant number of younger people being hospitalized, including some in ICU.
The CDC believes symptoms may appear anywhere from two to 14 days after being exposed.
Human coronaviruses are usually spread through...
- The air by coughing or sneezing
- Close personal contact, such as touching or shaking hands
- Touching an object or surface with the virus on it, then touching your mouth, nose or eyes before washing your hands.
Help stop the spread of coronavirus
- Stay home when you are sick.
- Eat and sleep separately from your family members
- Use different utensils and dishes
- Cover your cough or sneeze with your arm, not your hand.
- If you use a tissue, throw it in the trash.
- Follow social distancing
Lower your risk
- Wash your hands often with soap and water for at least 20 seconds. If soap and water are not available, use an alcohol-based hand sanitizer.
- Avoid touching your eyes, nose, and mouth with unwashed hands.
- Avoid close contact with people who are sick.
- Clean and disinfect frequently touched objects and surfaces.
- If you are 60 or over and have an underlying health condition such as cardiovascular disease, diabetes or respiratory illnesses like asthma or COPD, the World Health Organization advises you to try to avoid crowds or places where you might interact with people who are sick.
Get complete coverage of the coronavirus by texting 'FACTS' to 713-526-1111.
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