“People who think this will be a V-shape [rebound] and off we go again will be mistaken,”

Trader who called oil’s rout sees crude below $40

But that bounce faded fast. Nymex WTI crude ended Friday less than $1 away from a six-year low set earlier this year, extending a sharp weekly decline after theInternational Energy Agency said signs of price stability were a “facade” in the face of rising production.

Also, oil inventories continue to grow. Now, the big question is how much onshore storage capacity remains in the U.S., where crude inventories are at their highest level in more than 80 years, according to government data. King said there is a danger space could run out, leaving more oil to flood the physical market—a proposition that he expects to be tested in the next four weeks.

And despite falling rig counts, U.S. oil production is still around 1.2 million to 1.3 million barrels a day more than it was this time last year, King estimated.

U.S. adding 5 million barrels of oil to its reserves because of cheap prices

The U.S. is sitting on about 691 million barrels of oil in its Strategic Petroleum Reserve (SPR), and with oil prices close to a five-year low set in January, the U.S. is looking to buy even more, soliciting bids for 5 million barrels of oil, worth about $224 million at the closing price on Friday, March 13, of $44.84 on NYMEX.

The Department of Energy said it plans to buy sweet crude for delivery for its Freeport, Texas, site between June 1 and July 31 and perhaps as early as May, according to a federal website.

The SPR is composed of four giant underground oil fields in Texas and Louisiana, and it sits awaiting a call from the president, in case oil supplies are disrupted.

Oil futures suffer nearly 10% weekly plunge

The number of U.S. rigs actively drilling for oil as of March 13 fell 56 rigs from last week to 866.

 The IEA forecast average global oil demand of 93.5 million barrels a day for 2015.