As reported before by Cointelegraph, the May 2022 Futures contract for Westward Texas Intermediate (WTI) Rough dropped more than than 100% on Monday. At its worst the price reached negative $37.63, a phenomenon which has never occurred earlier.

WTI May futures (CL1). Source: TradingView

The June WTI contract with a May 19 expiry date also dropped nearly 20% to $20.43 per butt and Barclays IPATH ETN (OIL) vicious to $3.50.

OIL drops to $3.fifty. Source: TradingView

Less than a calendar month ago, OPEC and Russian federation ended their oil war by agreeing to cut product by 9.seven million barrels per twenty-four hours on May ane but at this indicate any confidence inspired past the deal has likely evaporated.

The precipitous drop shows that the global economy remains in fragile shape despite the strong rebound seen in the Dow and Due south&P 500 in the terminal 3 weeks. The price collapse in oil futures also highlights the impact the coronavirus pandemic has had on global demand for oil as everything from the airline manufacture, shipping, and structure projects have essentially come to a standstill.

The situation is further exacerbated by producers beyond the globe who continue to pump and fears that traders have limited access to storage for the oversupply. Fifty-fifty more worrisome is the spread between May and June contracts and some analysts suggest this can be interpreted every bit a surly betoken equally traders fright they will not observe a place to deliver physical crude in the future.

While today's collapse in WTI futures is shocking and unprecedented, the June WTI contract and Brent rough remain above $20. Meanwhile traditional markets closed in the red on Monday only after hours the Dow and Due south&P 500 futures accept turned positive, gaining 0.52% and 0.58% respectively.

What about Bitcoin?

BTC USDT daily chart. Source: TradingView

Bitcoin (BTC) price also corrected iv.23% every bit WTI futures imploded and at the time of writing the cryptocurrency trades for $vi,820. As the decline in oil prices kicked off, Bitcoin price dropped below the $7,200 support after failing to overcome the $7,277 resistance over the weekend.

After losing the $7,000 handle, the price vicious through a more disquisitional support at $6,850 and currently traders are fighting to hold the price above this level. A drop beneath the high volume VPVR node at $6,850-$6,625 opens the door for the cost to revisit $vi,300.

The collapse in oil prices and relative stability in Bitcoin price set crypto Twitter a burn down with memes and statements comparing the Federal Reserve's current quantitative easing policy to OPEC's plan to continue pumping oil even though this is a meaning oversupply and limited demand at the moment.

Many crypto advocates were also quick to point out that Bitcoin'south capped supply provides it with a unique advantage when compared to the limitless printing of the U.S. dollar and the unending extraction of oil.