IN a shocking event, while the world is battling with the Covid 19 pandemic, another war is raging between Russia and the Arab’s on who can supply the most barrel of oil into the market. This act of desperation has caused the price of oil to plummet drastically, at a time where supply is way much higher than demand.

For obvious reasons, countries around the planet have been reducing the use of petrol as lockdowns means no cars on the road and airplanes grounded. With the fact that consumption for the commodity is seeing such low volume, the two biggest suppliers in the world refused to cut production and has now created a glut in the market. Due to this the oversupply is causing headache for nations that purchase and store them, as most who have been stocking for the past three months have run out of storage. This triggered a further impact on the pricing, bringing to value for a barrel to zero and even at one point retreated into negative territory.

Never before in history since oil was discovered has such an occurrence taken place, as of yesterday price for a barrel was -$37.63. Producers had to pay for buyers if they needed oil as cost of storing them went up. So the big question on everyone’s mind is what does this mean to consumers like you and me?

According to some analyst, we wont see the price coming down substantially at the pump stations, there will be savings but don’t expect Petronas or Shell giving free petrol away. Cheaper petrol will continue into May as stored inventory will need to be used before topping up. Besides even if you do get cheap fuel, where will you driving to, MCO has restricted movement within 10km. Dont forget Malaysia is a net producer of the black gold, so the impact on price will be economical to the country. While we wont see much difference at the pumps, it will be devastating to the country as a whole if the price does not inch up. Our economy is at standstill, our biggest contributor to the national budget, Petronas will not be able to support the huge stimulus package which were distributed and we still have the virus to contend with.

The triple whammy factor is a toll on the country, so while I would welcome the free petrol if there is any but for now there are bigger issues to address.