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Oil prices plunge negative to hit all-time low

U.S. crude oil prices have plunged to all-time lows, raising further concerns over the future of electric vehicles as gas becomes more affordable.

Future speculation on the May contract for West Texas Intermediate crude oil has kept plunging Monday. After falling to below $1 per barrel, prices went negative for the first time ever.

BREAKING: Crude oil price on May contract goes negative for the first time

— CNBC Now (@CNBCnow) April 20, 2020

The May contract applies to fuel that is set to be delivered, while most of the United States remains on lockdown amid the COVID-19 pandemic. There are no buyers for the oil because of various suspensions to operations and travel, which means that the storage tanks of refineries and airlines are still full, CNBC reported.

The price of crude oil prices is the most important factor in the cost of producing gasoline and diesel. The plunging oil price likely means that gas prices in the United States will continue to remain cheap. As of April 17, the average price across the country was $1.82 per gallon, with at least a dozen states seeing gas prices of below $1, according to ABC7 News.

Electric vehicles affected by gas prices

There were already concerns that the electric vehicle industry will be hurt by lower gas prices. Electric vehicles are generally more expensive than their gasoline-powered counterparts, but buyers opt for them in order to save on fuel costs. When gas is cheap, one advantage of purchasing electric vehicles dries up.

“Saving on fuel costs is still a component for many EV shoppers,” Karl Brauer, the executive publisher of AutoTrader and Kelley Blue Book, told Digital Trends. “It’s more of a consideration for some than others, but saying it’s a nonissue for all of them isn’t accurate.”

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