Business has been slow at the Shell gas station in Thousand Palms.

Managing partner Victor Khouri says coronavirus lockdowns are hurting the bottom line, “Last month I went in the hole close to $12,000 in our books because we had no business, all we had was expense … if it continues on this path this station will be closed.”

The bigger picture is grim too. No one is flying, driving, working and companies are sitting idle drying up demand for U.S. oil.

There’s so much of it, there’s no place to store it.

“No one is buying that inventory, you’re going to have to give it away and that’s what they’re doing right now,” says Khouri.

U.S. crude oil prices dropped sank to a historic low to – $37.63 a barrel for May futures of West Texas Intermediate, about 300 percent.

Ryan Wilson, Sr. Vice President and financial advisor at RBC Wealth Management in Palm Desert, says even with major producers cutting ten percent of supply weeks ago it wasn’t enough to fix demand issues, “This is an unprecedented stoppage in work activity around the globe and so you just have a real glut of oil particularly here in the U.S., we have a storage issue.”

And it may cost U.S. companies more to stop and start production than to sell the surplus at a loss.

Still Wilson says the headline is deceiving, “It doesn’t mean we’ll get free gasoline it is more of a trader’s signal than anything.”

But he says gas prices will be low for a while and that may rev up the economy, “If we get into the summer season and we are making some progress, and we do have an ability to make some road trips, this might help our pocketbooks when we do so.”

U.S. Crude Oil Prices Sink to Historic Low