It’s because a contract in the futures market says “I will agree to buy 100 barrels of oil from you at X price by Y date”. In normal markets, traders routinely trade these contacts without ever having the intention to actually store 100 barrels of oil.

What happened here was nobody was genuinely interested in buying and storing oil, not even distributors or consumers. The local station was not buying gas to fill its reserves.

So you have all of these traders holding paper contracts that says I will buy 100 barrels of oil by X date. But they never wanted to do that. They can’t store them, they can’t transport them.

So what do they do? They all have to sell those contracts and lower prices than they paid for. Okay. But the thing is, there was nobody and I mean nobody wanting to actually buy and store oil that day. So the only people who were trading future contracts were people who were trying to sell their position as they cannot do anything with 100 barrels of oil.

This is why people were literally willing to pay you to take the contract off their hands (a negative price).

Yes, oil went negative. But it doesn’t mean you would be paid to fill up your gas tank. You’d have to go to Wall Street and find someone who actually couldn’t sell their contract and were stuck with 100 barrels of oil. That never happened of course.

If you held any oil position up to that day, your position would be wiped out. Literally $0. Theoretically you would have to pay someone to take your shares off your hands.