US oil prices turn negative as demand dries up

Post by glofish » Tue, Apr 21, 2020, 1:12 AM UTC

firebird84 wrote: post #52

adventured wrote: post #48

Earlier quoted context omitted.

In an arrangement with the US Government it could be put into the ground, elsewhere. Doing it without state permission would be an entirely different matter however. I'm not aware of any very large, privately owned underground storage caverns (such that they could make a dent in absorbing the over-supply). This is being discussed: "The U.S. Energy Department is negotiating with nine companies to rent about 23 million…

Why don't we just take delivery of futures contracts directly? Isn't this a great time to fill the reserve?

Post by Waterluvian » Tue, Apr 21, 2020, 1:13 AM UTC

propter_hoc wrote: post #10

So they start off the article with this statement: "That means oil producers are paying buyers to take the commodity off their hands over fears that storage capacity could run out in May." This statement is actually totally false. Producers already got paid for this production a long time ago when they initially sold the futures contract. What has actually happened is that as the expiry of the May futures contracts a…

Post by comicjk » Tue, Apr 21, 2020, 1:16 AM UTC

zw123456 wrote: post #38

Could you just take it and they pay you to take it and dump it into dry wells in Texas and Oklahoma, seems like a reasonable gamble ? Shrug....

Post by ycombobreaker » Tue, Apr 21, 2020, 1:17 AM UTC

core-questions wrote: post #24

fennecfoxen wrote: post #14

Earlier quoted context omitted.

With regulatory approvals? Probably years. The smart equivalent is to get a tanker ship and just float it out at sea until someone wants the oil (usually just west of Africa, where you can easily dispatch it to whoever ends up needing it.) Not sure if it works quite as well with WTI instead of Brent crude, though.

It is probably a fair and terrible assumption that others have thought of this already and that, in fact, tanker ships are filling up all over the place right now. Statistically, this means we're more likely for a spill, somewhere.

Post by mistrial9 » Tue, Apr 21, 2020, 1:18 AM UTC

maxehnert wrote: post #19

Since oil is making the front page here, if you're interested in the history of American oil industry, "The History of the Standard Oil Company" by Ida Tarbell is a fantastic read. It's also a great example of investigative journalism. In early chapters of the book she covers the initial rush to pump oil in the Oil Regions and the history of pipelines and storage facilities as it all ties into business practices of R…