Washington: Oil prices plunged below zero on Monday as demand for energy collapses amid the coronavirus pandemic and traders don’t want to get stuck owning crude with nowhere to store it.

Stocks were also slipping on Wall Street in afternoon trading, with the S&P 500 down 0.9%, but the market’s most dramatic action was by far in oil, where benchmark U.S. crude for May delivery plummeted to negative $3.70 per barrel, as of 2:15 pm, Eastern time.

Much of the drop into negative territory was chalked up to technical reasons — the May delivery contract is close to expiring so it was seeing less trading volume, which can exacerbate swings. But prices for deliveries even further into the future, which were seeing larger trading volumes, also plunged. Demand for oil has collapsed so much due to the coronavirus pandemic that facilities for storing crude are nearly full.

Benchmark U.S. crude oil for June delivery, which shows a more ”normal” price, fell 14.8% to $21.32 per barrel, as factories and automobiles around the world remain idled. Big oil producers have announced cutbacks in production in hopes of better balancing supplies with demand, but many analysts say it’s not enough.A price war between Saudi Arabia and Russia had accelerated the slide prior to the production deal, hurting US shale producers. And storage capacity is becoming scarce in the United States, with the main WTI facilities in Cushing, Oklahoma filling up.

“Basically, bears are out for blood,” analyst Naeem Aslam of Avatrade said in a report. “The steep fall in the price is because of the lack of sufficient demand and lack of storage place given the fact that the production cut has failed to address the supply glut.”

How can crude oil futures trade below zero? That’s a valid question being asked by those who are not familiar with the intricacies of the futures markets. Here’s what happened in crude oil futures today. The speculators who had been long the futures market were looking down the barrel of taking delivery of physical crude oil that they were going to own when the May futures contract expires Tuesday, and they had no place to put it. Speculators trade commodity futures markets with no intention of ever taking delivery of the physical commodity. However, it’s that physical delivery potential that is supposed to keep the futures market in sync with the cash, or spot market. Thus, the speculators were willing to pay to get out of that potentially disastrous situation of having to accept delivery of physical crude oil. On this day, a trader could literally not give crude oil away.

It’s likely some big hedge funds were caught on the wrong side of the crude oil futures market (long), and very badly. Last week, when oil futures were trading around $20 a barrel, the seemingly smart money was reckoning a quick U.S. economic recovery would push Nymex futures back above $25, or higher, in short order—just like the stock market had rebounded recently. Seemed like a no-brainer, right? Many of those “smart” traders on Monday were mortally wounded and a few will be forced out of the industry for good. There are a couple of old futures market-trading adages: “Markets will do anything and everything to frustrate the largest number of traders.” And: “Any time a trade seems like a no-brainer, you will likely lose your assets.” Both fit the crude oil futures market action seen today.