US oil futures plunge nearly 25% amid fears of filled storage

Oil prices fell significantly on Monday with the US benchmark down nearly 25 per cent amid fears over a growing scarcity of oil storage space.

The West Texas Intermediate for June delivery shed 4.16 U.S. dollars, or 24.56 per cent, to settle at 12.78 dollars a barrel on the New York Mercantile Exchange. The prices traded as low as 11.88 dollars earlier in the session.

Brent crude for June delivery dropped 1.45 dollars, or 6.76 per cent, to close at 19.99 dollars a barrel on the London ICE Futures Exchange.

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Risks on the demand side amid the COVID-19 pandemic fallout have reignited fears over availability of storage capacities, experts noted.

Monday's heavy losses followed extreme volatility on the oil markets in the prior week.

Despite a period of stabilization they have been enjoying since mid-last week, US oil prices posted a record weekly loss of 32.3 per cent based on the June contract. It is the biggest weekly percentage loss on record, according to Dow Jones Market Data. June Brent declined 23.6 per cent for the week ending Friday.