"The open interest situation is not nearly as dire as it was a month ago," said Shin Kim, head of supply and production analytics with industry intelligence provider S&P Global Platts recently.
Crude oil stocks in oil futures delivery location Cushing of Oklahoma showed a drawdown last week and will likely see another one this week, said Kim, adding that there is more confidence that the oil market will not run out of storage.
David Fyfe, chief economist with energy information supplier Argus Media, attributed the rapid decline of U.S. physical crude oil supply, U.S. crude oil inventory draw reported last week, diminished contango of oil futures prices as well as investors' earlier transfer of June contract to July contract to the relatively firm performance of crude oil futures price for June delivery.
Still, Fyfe told Xinhua on Tuesday that, "It is impossible to say that negative prices for NYMEX (New York Mercantile Exchange) WTI futures could never recur."
If a second wave of coronavirus infection takes place in autumn or early 2021 and crude oil demand suffers again, there is a possibility for crude oil futures price to go negative again, said Kevin Chen, chief economist with U.S. wealth management firm Horizon Financial at a webinar on Monday.
The WTI crude oil futures for May delivery turned negative for the first time ever and dived to -37.63 U.S. dollars per barrel on April 20 upon expiration of the contract, which shocked the financial market and caught many investors off guard.
The economic drag of COVID-19 not only would sink global crude oil demand in 2020 but also would make world's crude oil demand in 2021 substantially lower than that in 2019, according to S&P Global Platts Analytics.
Global crude oil demand in 2021 would be lower than that in 2019 by 700,000 barrels per day, said S&P Global Platts Analytics on Tuesday.
Global petroleum and liquid fuels consumption averaged 94.1 million barrels per day in the first quarter of 2020, a decline of 5.8 million barrels per day from the same period in 2019, according to a recent month oil market report by U.S. Energy Information Administration.