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Oil plunges below zero for first time with May contract ending

bloomberg.com

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Re: Oil plunges below zero for first time with May contract ending

#21

Post by nradov »

sz4kerto wrote: post #7
DevX101 wrote: post #2

Someone's going to find a creative way to store large amounts of oil and make a lot of money in a few years.

Nature has figured it out. (I.e.: the simplest way of storing oil is to not extract it.)

Once an oil well is producing the operators can't necessarily just turn it off. If they do cap it that can impair future production.

Re: Oil plunges below zero for first time with May contract ending

#22

Post by Maximus9000 »

sz4kerto wrote: post #7
DevX101 wrote: post #2

Someone's going to find a creative way to store large amounts of oil and make a lot of money in a few years.

Nature has figured it out. (I.e.: the simplest way of storing oil is to not extract it.)

For some producers that's easier said than done. You can't just shut the operation down and then start it up again.

Re: Oil plunges below zero for first time with May contract ending

#24

Post by harikb »

bob33212 wrote: post #20

What happens when Saudi Arabia collapses? Does the royalty get the fuck out of town on their private jets with as many gold bars as they can carry?

Dictators/Kings can survive on a very tight budget btw. It takes a long long time for those structures to crack. The only reason they would leave town would be something related to the virus (like other western rich folks are doing now)

Re: Oil plunges below zero for first time with May contract ending

#25

Post by dkn »

orev wrote: post #9
DevX101 wrote: post #2

Someone's going to find a creative way to store large amounts of oil and make a lot of money in a few years.

Maybe we can store it in large underground caverns (or maybe porous basins) and then pump it up to the surface only when we need it. We would probably want to coordinate with other people also doing pumping in their region, as not to end up with too much on the surface that we can’t use and then have nowhere to put it.

Is this the same thing as... not pumping it?

Re: Oil plunges below zero for first time with May contract ending

#26

Post by yur3i__ »

bob33212 wrote: post #20

What happens when Saudi Arabia collapses? Does the royalty get the fuck out of town on their private jets with as many gold bars as they can carry?

UAE and Saudi Arabia imo will be ok. They are trying to build themselves into big entertainment and tourism hubs with their ventures into sports and investment in tourism etc I think though they will definitely suffer they may be able to weather the storm. Kuwait and Qatar on the other hand I'm not so sure about

Re: Oil plunges below zero for first time with May contract ending

#27

Post by drcode »

bob33212 wrote: post #20

What happens when Saudi Arabia collapses? Does the royalty get the fuck out of town on their private jets with as many gold bars as they can carry?

This seems unlikely to me, given the low extraction costs they have for oil.

I guess the biggest danger they would face is if they have to stop "paying off" their population, and this leads to an "arab spring" type of situation. But it seems even in that case they would unfortunately have the will and resources to use Syria-style brutal tactics to contain any uprising.

Re: Oil plunges below zero for first time with May contract ending

#28

Post by DuskStar »

harikb wrote: post #24
bob33212 wrote: post #20

What happens when Saudi Arabia collapses? Does the royalty get the fuck out of town on their private jets with as many gold bars as they can carry?

Dictators/Kings can survive on a very tight budget btw. It takes a long long time for those structures to crack. The only reason they would leave town would be something related to the virus (like other western rich folks are doing now)

IIRC Saudi Arabia is a massive welfare state with significantly subsidized food, power, water and more - all paid for by oil. People might be more willing to revolt because of that going away than they would have had it never been a thing in the first place.

Re: Oil plunges below zero for first time with May contract ending

#30

Post by bb611 »

tantalor wrote: post #15
turbinerneiter wrote: post #5

Earlier quoted context omitted.

I think gas goes bad after some months, not sure if crude degrades as well.

It's been buried for 100 million years, I don't think a few months is going to do anything.

Gasoline and other petroleum derivatives are not a stable as their underlying source. However consumer gas will last a few years with proper care and storage, the real issue will be when appropriate storage runs out.
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