Stop finger-pointing, cooperate to fix economy

Amid the novel coronavirus pandemic, the Shanghai International Energy Exchange’s daytime crude oil futures contract declined to its single-day upper ceiling on Wednesday, a bad chain reaction on the Chinese oil market from the May contract for the United States crude oil futures turning negative on Monday.

West Texas Intermediate for May delivery shed $55.9 (395.64 yuan) to settle at-$37.63 a barrel on the New York Mercantile Exchange on Monday, down nearly 306 percent. It was the first time an oil futures contract has traded negative in history, which means producers would be paying buyers to take oil off their hands. The impact of negative oil prices on the global economy deserves our special attention.

In the past months, the novel coronavirus has been spreading around the world, almost bringing international air, land and sea transport to a complete halt. As a result, market demands for crude have greatly reduced and crude transportation and storage costs have significantly increased. Crude oil futures falling into negative territory just highlights the dealers’ pessimism over growing imbalance between oil supply and demand.

The rapid spread of the novel coronavirus pandemic not only poses a threat to the safety of human life, but also has a serious negative impact on global economic and social development. China’s GDP growth in the first quarter of 2020 contracted for the first time in decades, and serious pessimism has permeated the US, Japan, European Union and other major economies.

As an important energy product, oil plays a central role in economic operation. When the economy is on the verge of stagnation, oil products are the first to bear the brunt. The fall in oil futures prices into negative territory suggests that this important sector is under stress and could have a devastating effect on the global economy if it is not effectively repaired in the coming months.

The novel coronavirus, which knows no borders, is the common enemy of humankind, requiring concerted efforts from all countries to be contained. Attempts by some politicians to cover their own countries’ failings to prevent and control the epidemic by shifting the blame on China will not succeed. Worse, it has adversely affected global antiepidemic cooperation and economic recovery.

The global economy has been growing over the past three decades thanks to the benefits and dividends of globalization, but the international “anti-globalization” trend in recent years is destroying this hard-won fruit. The emergence of negative oil prices in the history of crude oil futures shows that the global economy is greatly affected by the epidemic, and also indicates the difficulty of global economic recovery after the end of the epidemic. All countries should immediately stop finger-pointing at others and actively promote antiepidemic cooperation to lay a much-needed foundation for global economic recovery.

— BEIJING YOUTH DAILY