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When Benchmarks Fail: The Causes and Consequences of Negative Oil Prices -- by Erik P. Gilje, Robert C. Ready, Nikolai Roussanov, Jérôme P. Taillard
A research paper examines the historic April 20, 2020 event when West Texas Intermediate crude oil futures settled below zero for the first time in history. The authors find that a key driver was large long positions held by uninformed financial traders unable to take physical delivery, which distorted demand signals and intensified pressure on limited storage capacity at Cushing, Oklahoma. The resulting price dislocation had real economic consequences, prompting oil production curtailments even