London (AFP)

Faced with the imbalance of sluggish demand and overabundant supply, certain types of oil are trading well below the price of reference barrels, one of them even having experienced a negative price.

Thus the American barrel of Wyoming Asphalt Sour, a dense oil used mainly to produce bitumen, "fell at a negative price" during the month of March, Per Magnus Nysveen of Rystad told AFP.

"It means that the producers give their barrels", summarizes Craig Erlam "because they have nowhere to store it", the world reserves of crude being already with the three quarters full.

Current crude oil reserves on land and in ships "exceed the previous peak reached in early 2017," Kpler analysts said in a note last week, "and these stocks continue to grow."

On Wednesday, the American Energy Information Agency (EIA) also reported a very significant increase in its stocks, four times greater than analysts' expectations.

Because if demand has been brutally reached by the Covid-19 pandemic and the containment measures that accompany it, supply on the other hand is only growing on the part of the main world producers, against a background of price war between Ryad and Moscow. This imbalance exerts very strong pressure on prices.

On Thursday, a barrel of Southern green canyon in the Gulf of Mexico was worth, for example, $ 13.31, the Nebraska intermediate $ 6.75 and the Oklahoma sour $ 4.25.

Western Canada select also evolved around the 5 dollar mark. "Taking transport costs into account, we can also consider that it too is in negative territory," adds Rystad analyst.

- American victims -

Seeing prices massively go below zero is "almost impossible," says Erlam.

However, Goldman Sachs analysts are more nuanced and mentioned in a note Monday "a context very unfavorable to oil prices" which could well send some "into negative territory".

"If the situation persists, some producers will start to turn off the taps," replied the analyst from Oanda, contacted by AFP, with the effect of reducing supply on the market and therefore supporting prices.

The first victims could be the companies that extract shale oil in the United States, the cost of which is for the most part much higher than current prices.

To defend his industry, US President Donald Trump announced Wednesday that he will receive the leaders of major American oil groups on Friday.

"We don't want to lose our formidable oil groups," Trump said in his daily press briefing on the pandemic.

"I think I know how to fix the problem," he added, without further details.

The two benchmark prices, the American WTI and Brent from the European North Sea, were worth respectively around 22 and 27 dollars per barrel.

They have lost two-thirds of their value since the start of the year, which represents their heaviest quarterly drop since the creation of these contracts in the 1980s.

© 2020 AFP