Negative $40 oil reflects panic - and U.S. crude market economic reality

[Rimmer]

A troll post removed

[spiekerjozef]

Excellent, cheap fuel. Perfect !

[samran]

20 minutes ago, spiekerjozef said:

Excellent, cheap fuel. Perfect !

It ain’t pretty, and in this case, it is down right ugly, but for a market which literally lives and dies by the sword, a dose of shumpeterian economics seems apt. 

[RubbaJohnny]

6 hours ago, thaibeachlovers said:

I was told in the early 1960s that oil would run out in 20 years.

 

It's BS that they can't store it, IMO. The country that built thousands of ships, planes and tanks to win WW2 can certainly build some storage tanks for oil.

I have no doubt someone is going to get very very rich over this IMO fake crisis.

Maybe , but how fast and at what cost, the pipes, tanks, pumps, engineers,, construction reservoirs and land aren't free.

I think this a temporary blip and will break Bakken et al until it becomes profitabel to frack again. The fuel isn't lost in fact is being conserved until price is higher/technology cheaper.

Tragic for the workers and communities that depend on a sole big payer.

 

However the producers are energy companies and the big players liek EXXOn Royal Dutch Shell BP will diversify into what ever is profitable, solar, tidal , bimass etc

[khunken]

30 minutes ago, RubbaJohnny said:

Maybe , but how fast and at what cost, the pipes, tanks, pumps, engineers,, construction reservoirs and land aren't free.

I think this a temporary blip and will break Bakken et al until it becomes profitabel to frack again. The fuel isn't lost in fact is being conserved until price is higher/technology cheaper.

Tragic for the workers and communities that depend on a sole big payer.

 

However the producers are energy companies and the big players liek EXXOn Royal Dutch Shell BP will diversify into what ever is profitable, solar, tidal , bimass etc

Yes, the cost & time required to build storage tanks will not be enough to hold the current oversupply. The only possible way is to do what the Saudis are doing: rent as many supertankers as possible, fill them up and park (anchor) them somewhere. The US may well be too late to the party with this as there is a limited number of supertankers.

 

Actually oil companies such as Shell, BP, Total & ENI are already investing in alternative energy companies. Exxon & Chevron may well have to use their money to do the same, rather than wasting money with lobbies supporting uncle toupee's (thanks Rooster) ignorant anti-scientific policies.

[ExpatOilWorker]

Weekly numbers coming out every Wednesday. 

 

https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=WCRFPUS2&f=W

[metisdead]

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Edited April 21, 2020 by metisdead

[sirineou]

12 hours ago, Tug said:

Damm cheep gas but can’t travel oh the humanity’s 

LOL !!

Oil  price is low because you can't travel, It's a Catch 22 

9 hours ago, BRUFC said:

LOL !!

Stuck in the US, we have Three cars here, A Mitsubishi Outlander for the wife, a Hyundai Santa Fe  for the daughter and a Toyota Corolla for me. We filled all three cars when this thing started a few weeks ago . Only the Outlander has half a tank now, the other two are still full.

Can't wait for this thing to be over so we can come to Thailand!! you never miss something as much as until you cant have it.

Edited April 21, 2020 by sirineou
typo

[winslowsjardine]

10 hours ago, Chomper Higgot said:

There was an article in the Financial Times explaining SA’s strategy, it’s paywalled so so haven’t posted a link.

 

Needless to say it is a strategy and it is working.

 

The price is collapsing because there is no demand, Big Oil is hurting and there’s no point making phone calls.

There is a way to legitimately get around ft.com's pay wall. Just copy the headline and do a search in incognito mode in Chrome or whatever the equivalent is in Edge or Firefox. Click on the link to the ft.com article and there you are.

[Cryingdick]

12 hours ago, Chomper Higgot said:

There was an article in the Financial Times explaining SA’s strategy, it’s paywalled so so haven’t posted a link.

 

Needless to say it is a strategy and it is working.

 

The price is collapsing because there is no demand, Big Oil is hurting and there’s no point making phone calls.

 

I know it would pain you to ever wish the USA well but there are a lot of analysts who think the Saudis are on the path to disaster. If they want to play games the USA can do that too. How about a nice little embargo? 

 

Not only is there no demand but there is also an overwhelming glut. I am not sure how long it takes us to draw that down when demand comes back. Then the military implications. A quick google of is Saudi Arabia going broke turns up many results.  Their cash reserves are shrinking.

 

Some articles are older than others. One points out the desperation move that is Aramco. Aramco is a pretty clear sign they need outside money because their reserves aren't sufficient.  

 

Anyway can you give me a brief explanation of the brilliant plan that's been working? I know they took a 10% stake in Carnival Cruise Lines but that's like me digging a quarter out of my sofa. $2 billion in Tesla, a $400 million in Uber etc. But those amounts are nothing. 

 

Also I can access the Financial Times so you could simply give me the link or the title of the. article. Thanks.

 

https://finance.yahoo.com/news/saudi-arabia-oil-war-could-230000595.html

 

https://www.elitereaders.com/saudi-arabia-bankrupt-2020/

 

https://www.ai-cio.com/news/petraeus-saudi-arabia-running-money/

Edited April 21, 2020 by Cryingdick

[richard_smith237]

7 hours ago, khunken said:

Yes, the cost & time required to build storage tanks will not be enough to hold the current oversupply. The only possible way is to do what the Saudis are doing: rent as many supertankers as possible, fill them up and park (anchor) them somewhere. The US may well be too late to the party with this as there is a limited number of supertankers.

 

Actually oil companies such as Shell, BP, Total & ENI are already investing in alternative energy companies. Exxon & Chevron may well have to use their money to do the same, rather than wasting money with lobbies supporting uncle toupee's (thanks Rooster) ignorant anti-scientific policies.

 

Many produced reservoirs have been over produced (especially Middle East Carbonates). 

 

I wonder how much of a viable option it would be for a smaller producer to take a large amount of ‘negatively priced oil’ off the hands of some of the major producers and inject it into some of their depleted reservoirs and re-produce it at a later date when the price picks up. 

 

Gas is stored under pressure in washed out salt caverns in many areas (i.e. France), I wonder if oil could be stored in a similar manner in subsurface salt caverns. 

Edited April 21, 2020 by richard_smith237

[thaibeachlovers]

16 hours ago, Chomper Higgot said:

The world’s oil storage is already at near full capacity, and nobody knows how long the economic recession will last.

 

Your idea of building more storage will not make anybody rich.

I never said it would, only that they could if they wanted to. The reason for the panic, that there isn't enough storage, is, IMO, bogus.

[thaibeachlovers]

16 hours ago, Chomper Higgot said:

Speak for yourself.

 

 

So, you really enjoyed your stay? You must have worked there to know.

[thaibeachlovers]

16 hours ago, samran said:

Tell me how you can build all this storage and make money off it....

Not everything is about money. Capitalism much?

[thaibeachlovers]

12 hours ago, RubbaJohnny said:

 

However the producers are energy companies and the big players liek EXXOn Royal Dutch Shell BP will diversify into what ever is profitable, solar, tidal , bimass etc

That could only be a good thing, EXCEPT they'll be seeking to maximise profits by buying out the small businesses, and that can only lead to more expensive energy for us, the consumer.

Hydrogen is the way to go, IMO.

[ExpatOilWorker]

1 hour ago, thaibeachlovers said:

I never said it would, only that they could if they wanted to. The reason for the panic, that there isn't enough storage, is, IMO, bogus.

Reuters: A hunt for any storage space turns urgent as oil glut grows.
https://www.reuters.com/article/us-global-oil-storage-fracking/a-hunt-for-any-storage-space-turns-urgent-as-oil-glut-grows-idUSKBN2230I3?feedType=mktg&feedName=ousivMolt&WT.mc_id=Partner-Google

[Tug]

ill Bet MB’s is sweating bricks no money he’s toast bone saw anyone?sure glad I’m not working in the oil patch and I hope things improve soon but not for MB’s lol

[metisdead]

Some off topic posts and replies have been removed. 

[thaibeachlovers]

1 hour ago, Tug said:

ill Bet MB’s is sweating bricks no money he’s toast bone saw anyone?sure glad I’m not working in the oil patch and I hope things improve soon but not for MB’s lol

Perhaps you can stop using abbreviations others do not understand. What does MB stand for?

[Cryingdick]

1 minute ago, thaibeachlovers said:

Perhaps you can stop using abbreviations others do not understand. What does MB stand for?

 

It's a typo he means MBS Mohammed Bin Salman. I have an advanced degree understanding his posts it isn't easy at times.

[owl sees all]

It seems pretty obvious to me.

 

At the mo' world useage is about 30% of world output. Have to store the difference. If storing is not an option, as it seems it might not be due to ressies being filled and the tankers being full and cannot unload.

 

Option one: stop production. Option two: fill up the grand canyon. Option three: put it back in the ground (and get it out later).

 

Easy peasy.

[Cryingdick]

1 minute ago, owl sees all said:

It seems pretty obvious to me.

 

At the mo' world useage is about 30% of world output. Have to store the difference. If storing is not an option, as it seems it might not be due to ressies being filled and the tankers being full and cannot unload.

 

Option one: stop production. Option two: fill up the grand canyon. Option three: put it back in the ground (and get it out later).

 

Easy peasy.

 

Stop pumping...

[owl sees all]

29 minutes ago, Cryingdick said:

 

Stop pumping...

Absolutely! Or at least cut production to less than 30% of what it is at the mo'. Other options are not viable.

[sukhumvitneon]

$0.93/ gallon for gas in Ohio, USA.  Incredible.

 

http://archive.is/d8mNM

[Cryingdick]

5 minutes ago, owl sees all said:

Absolutely! Or at least cut production to less than 30% of what it is at the mo'. Other options are not viable.

 

Pretty simple. Stop pumping and let KSA go bankrupt. The investment fund the Saudis have is pretty dodgy. They have a few billion spread around and one market turn will wipe them out. I own some Tesla shares and it has done great but that stock is waiting to plunge. It isn't what I would put $2 billion into.The Kingdom financially is dumpster diving.

 

Better yet just block the Saudis from accessing the US equity market altogether. 

 

Cut all US production put a tariff of 500% on Saudi and Russian oil above a certain limit. We need the type of oil they have for some things. 

Edited April 22, 2020 by Cryingdick

[ExpatOilWorker]

During intraday trading June contracts collapsed by more than 45 percent, falling close to $11 per barrel. 

 

OilPrice.com: The Worst Is Yet To Come For Oil Prices.
https://oilprice.com/Energy/Crude-Oil/The-Worst-Is-Yet-To-Come-For-Oil-Prices.html

[Cryingdick]

1 hour ago, ExpatOilWorker said:

During intraday trading June contracts collapsed by more than 45 percent, falling close to $11 per barrel. 

 

OilPrice.com: The Worst Is Yet To Come For Oil Prices.
https://oilprice.com/Energy/Crude-Oil/The-Worst-Is-Yet-To-Come-For-Oil-Prices.html

Wait a little bit you are about to see one of the best trades of this century. 

[Logosone]

This happened yesterday.

 

It did not cause the USD to go up wildly against the CAD, the oil currency. 

 

Only today is USD going up against CAD. Why is that?

 

Obviously not a big panic, or else the Canadian dollar would have fallen like a stone. 

[Cryingdick]

4 minutes ago, Logosone said:

This happened yesterday.

 

It did not cause the USD to go up wildly against the CAD, the oil currency. 

 

Only today is USD going up against CAD. Why is that?

 

Obviously not a big panic, or else the Canadian dollar would have fallen like a stone. 

Because most traders know that it is a paper problem that made oil crash so much. It is shocking for the public. Nobody is storing oil in their backyard. The average person doesn't understand how futures contracts actually work.

Edited April 22, 2020 by Cryingdick

[Logosone]

3 hours ago, Cryingdick said:

Because most traders know that it is a paper problem that made oil crash so much. It is shocking for the public. Nobody is storing oil in their backyard. The average person doesn't understand how futures contracts actually work.

Yes, in theory it is a paper problem. But it should tarnish the commodity of oil for investors generally.

 

And yet as I speak the CAD is going up against the USD.

 

How bizarre is this?