The 2020 coronavirus pandemic has destroyed more demand in the oil industry than ever before in history. The steps taken by governments to arrest the spread of the virus that causes COVID-19 have cut oil consumption by 25% or more. In the U.S., gasoline consumption has fallen to levels last seen during the Vietnam War.
And even though oil prices have rebounded since U.S. crude futures went negative on April 20, the worst is yet to come for many oil companies: Oil production continues to exceed demand, and storage facilities run out of spare capacity. We've already seen several prominent oil companies go bankrupt, and more bankruptcies are coming.
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