A US regulator said oil traders should prepare for negative prices again as soon as next week

May 15, 2020: A US regulator said oil traders should prepare for negative prices again as soon as next week

Schlumberger oil pipe

The US Commodity Futures Trading Commission urged market participants to prepare for negative oil prices again when the West Texas Intermediate futures contract for June expires next Tuesday.

In a notice on Wednesday, the CFTC urged participants to "maintain rules to provide for the exercise of emergency authority, as is necessary and appropriate, including the authority to liquidate or transfer open positions in any contract; to suspend or curtail trading in any contract."

"We are issuing this advisory in the wake of unusually high volatility and negative pricing experienced in the May 2020 physically-delivered WTI contract, and related reference contracts, on April 20," the notice added.