No one is driving along.

The journey is very fewer, making oil where no consuming with locked down has come an almighty slump in demand for oil.

But while it's still pumping out of American soil and nowhere left to store it, panic has ensued.

U s prices of oil due for delivery next month, plunge yesterday to minus $38.

It since recovered to around zero.

Optimists hope that collapse was mainly technical and isolated.

But today the slump spread.

Prices for June also collapsed, dropping 42% at one point hitting $12 a barrel.

Further falls followed in other markets, like Brent crude on when stock markets opened around the world this morning, oil grease their slight to nearly all falling in value today, analysts warned.

We might not have seen the worst of this yet, and this isn't just a problem for the U.

S.

But for anyone that produces oil, it could get worse before it gets.

But so I think the storage problems I'm are going to go away at the trajectory, I think really depends on how quickly Covad, 19 is under control and demand and transport normal life resumes a Z well as potentially on the supply side, those producers Russia, Saudi North America reaching an agreement to restrict supply.

The American president disagrees.

Supplies in the problem, he says, is traders trying to make a quick buck.

So if you take a look at it, you'll see it's more of a financial thing than an oil situation.

But because you take, I believe in a month or so, in other words, go a little bit out.

It's a 25 and 28 dollars ago, so it's largely a financial squeeze.

And they did get squeezed.

A little over a week ago, the group of oil producing nations OPEC agreed to cut production by 10% by June.

The boss of the International Energy Agency says the cut can't wait.

The most important thing is is Saudi Arabia, Saudi Arabia, Russia and other producers agreed to cut production, but they will be effective.

Their decision is the first of May.

In my view, they should a Souness possible between 24 hours, cut the production and getting a breathing space toil industrial in the US they may call it black gold, but the fear is black gold might just not be worth enough for long enough to keep these pumps and thousands of jobs emotion.

Earlier, I spoke to conservative MP Mel Stride, who's the chairman of the Treasury Select Committee On that began by asking him if the lock down does continue for some months, with the economic aid promised by the chancellor continued to be open ended.

Well, I think what the chancellor has said is that it's a case of whatever it takes to support the economy.

Onda.

Clearly what is being attempted here is to keep what would otherwise be entirely viable businesses afloat and functioning such that when this recovery comes back and it will come back in time, we don't know when yet, but it will do that Those companies start to fire up in the economy that starts to move forward.

I think the interesting question that you might be asking as well, how long can the government go on paying millions of people's wages and so on through furlough schemes and providing soft loans?

And that is really a question about how much the government cannon is prepared to borrow on there.

I think we actually have a reasonable amount of headroom, albeit that borrowing will be undoubtedly spiking in the current lots ahead.

But it's not indefinite, is it?

At what stage have you calculated that that boring has to come to an end?

Because we simply can't afford it?

Well, in terms of affordability.

And I think there are two issues here, what one is what what size of debt are we heading towards?

And the OPR has suggested, on the basis of a three month locked down or three months of phasing out of lock down that we'd hit a debt level approaching 100% of GDP.

Now that is indeed a historic high for peace time.

However.

In the Second World War, for example, it hit 250% so that's the first point.

The second point is, what, when you say affordability, what is the cost of servicing that debt?

And the government has bean able to borrow historically very low interest rates?

Andi.

I think it's a reasonable assumption to make that it will continue to be able to do so on on that basis.

I think probably it's got a reasonable amount of fuel in the tank in terms of additional borrowing to get us through this, and it's absolutely right.

Incidentally, that it does, that is, I think, the alternative of stepping back at any point in saying right, we're just stop supporting these companies.

Aries off too early, too quickly and you find that that economic bounce back would not occur.

And what you'd see actually is medium, a long term scarring of the economy, which would takes a long time to fix.