Why Crude Oil Prices Turned Negative in 2020?

In this video, we break down a question most traders don’t even consider: Can commodity futures go below zero?
Surprisingly, the answer is yes—and it has happened before.

Using the April 2020 crude oil crash as a real-world case study, we explain how WTI crude futures settled in negative prices, what caused the extreme move (global lockdown, demand collapse, storage issues at Cushing, and the futures–spot mismatch), and why the entire trading ecosystem wasn’t prepared for negative pricing.

We also cover the key changes introduced after that event—especially how MCX crude contracts moved to cash settlement, why the delivery mechanism was removed, and what traders should know about contract expiry timelines and settlement mechanics today.

If you trade crude oil futures or options, this video will help you understand the risks behind extreme events and how the market structure has evolved since 2020.

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Groww does not advise on individual stocks and firmly believes that viewers should do their own research before investing.

Also, our viewers should keep in mind that trading in securities and derivatives can be risky and most people may end up losing money in such trades. While we would love to educate you about trading, we don't promote or recommend engaging in such high-risk products.

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Name of the narrator: Tanmay Kurtkoti
Date: 15/01/2026

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Видео Why Crude Oil Prices Turned Negative in 2020? канала Commodities with Groww