Washington, Apr 22 (IANS): US President Donald Trump has directed his administration to work on a plan to get funding to the oil and gas industries as a steep sell-off in oil futures continued.
"We will never let the great US Oil & Gas Industry down," Trump tweeted on Tuesday morning, Xinhua reported.
"I have instructed the Secretary of Energy and Secretary of the Treasury to formulate a plan which will make funds available so that these very important companies and jobs will be secured long into the future!" Trump said.
At a White House press briefing on Monday, Trump said that the US was "looking to" add as much as 75 million barrels of oil to its Strategic Petroleum Reserve (SPR) "based on the record low price of oil".
US Energy Secretary Dan Brouillette told Bloomberg on Tuesday that the US government is taking "aggressive and appropriate steps" to help the oil industry during the pandemic, and he is eyeing the Federal Reserve's Main Street lending program to help oil companies.
Fuelled by pandemic-related demand shock and oversupply fears, the soon-to-expire May contract for US oil futures prices crashed to the negative territory for the first time in history on Monday.
The West Texas Intermediate (WTI) for May delivery shed $55.9, or over 305 per cent, to settle at -37.63 USD a barrel on the New York Mercantile Exchange, implying that producers would pay buyers to take oil off their hands.
The May contract managed to turn positive as of midday Tuesday. However, the most-active June contract for the US benchmark plunged more than 30 per cent to settle around $11.57 dollars a barrel.
The oil and gas industries have seen a historic sell-off amid the coronavirus pandemic. Almost 40 per cent of US oil and natural gas producers face insolvency within the year if crude prices remain near $30 a barrel, according to a recent survey by the Federal Reserve Bank of Kansas City.
"Expectations for future activity also fell to their lowest level since late 2014, as most firms do not expect energy prices to return to profitable levels this year," said Chad Wilkerson, an economist at the Federal Reserve Bank of Kansas City.