The world is awash in oil, and global giants are moving ahead with plans to flood oil markets further. Major oil benchmarks are down sharply on March 18, following the weekly U.S. Energy Information Administration (EIA) petroleum report.

In the report, the EIA said crude oil inventories increased by 2 million barrels from last week to 453.7 million barrels. And while that's 3% below the five-year average for this time of the year, global oil products consumption is expected to fall sharply as the coronavirus pandemic sends travel and industrial activity to a grinding halt all around the world. 

Dollar bill with red numbers printed on it.

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At this writing, West Texas Intermediate futures, the key benchmark for U.S. oil, has fallen to an intra-day low of $20.98 per barrel, a 23% decline from yesterday's closing price. That's on track to be the lowest price for U.S. crude oil since February 2002. 

Brent crude, the world's most important crude oil benchmark, is down 13% to $25.03 per barrel, which would also be a 18-year low if it holds through the end of trading. 

Oil markets in panic as global recession becomes more apparent

The U.S. federal government has announced drastic steps over the past several days to keep the financial operating, and cushion the blow to individuals, including a plan to send cash directly to Americans, but it's looking more and more certain that global recession is unavoidable. 

Many U.S. oil companies are set for significant pain in the year ahead, and many independent oil producers won't survive. Chesapeake Energy (CHKA.Q) was already in financial straits before oil prices crashed, and it has now hired restructuring advisors to help management determine a path forward, which is looking more and more like bankruptcy. ExxonMobil Corp (XOM 1.50%), with more than $3 billion in cash and a manageable debt load, is expected to slash spending to make ends meet, and has lost more than half of its market value this year. 

There will be winners from the oil crash, but any company that counts on oil production is faced with the most uncertainty oil markets have faced in more than a decade.