The Art of the Deal

murphstahoe

8639
+2081/-143

Trump refilled the strategic oil reserve in March at a price of $30 a barrel ! Nice price!

Except that oil is trading at NEGATIVE one dollar a barrel now. Oil producers are literally willing to pay people to take their oil away because the wells are still spouting oil, and they have nowhere to put it. If someone will take the oil away, then they can avoid capping the wells which is even more costly than paying someone to take the oil.

Nice deal their honcho. "Nobody could have seen this coming!"

Logged

Custard

12563
+239/-3063

Re: The Art of the Deal

« Reply #1 on: April 20, 2020, 02:05:48 PM »

I read about this as well. With such a situation you’d think people with money and power (oil people, government) would be able to find a place to put the oil. Or build one.

Logged

Poster Boy for White Male Indifference

AOTC on basically everything measurable

“Custard, you were RIGHT!” -Tempo

murphstahoe

8639
+2081/-143

Re: The Art of the Deal

« Reply #2 on: April 20, 2020, 02:09:10 PM »

Quote from: Custard on April 20, 2020, 02:05:48 PM

I read about this as well. With such a situation you’d think people with money and power (oil people, government) would be able to find a place to put the oil. Or build one.

They are storing it anywhere they can, tankers, filling pipelines and then capping them off, whatever they can. There are costs with capping a well so they are trying to avoid or prolong that but at some point if we aren't using it, they don't build tanks they never use unless global oil demand vanishes overnight

Logged

Custard

12563
+239/-3063

Re: The Art of the Deal

« Reply #3 on: April 20, 2020, 03:00:19 PM »

The way I’m looking at it is how a farmer stores grain to capture higher prices rather than dumping it at the elevator during the glut of harvest when the prices are usually at their lowest. I would think investors or people who could afford the capital outlay would try to find a way to store as much free oil as they could to keep them from capping wells and then eventually when demand picks back up start releasing it back into the market.

Logged

Poster Boy for White Male Indifference

AOTC on basically everything measurable

“Custard, you were RIGHT!” -Tempo

murphstahoe

8639
+2081/-143

Re: The Art of the Deal

« Reply #4 on: April 20, 2020, 03:03:33 PM »

Quote from: Custard on April 20, 2020, 03:00:19 PM

The way I’m looking at it is how a farmer stores grain to capture higher prices rather than dumping it at the elevator during the glut of harvest when the prices are usually at their lowest. I would think investors or people who could afford the capital outlay would try to find a way to store as much free oil as they could to keep them from capping wells and then eventually when demand picks back up start releasing it back into the market.

In the US, this doesn't happen because Exxon needs to make quarterly numbers.
In OPEC, this doesn't happen because Putin or MBS or the Ayatollah or whomever just want as much money now as they can get.

Logged

ILLove1997

6451
+80/-2021

Re: The Art of the Deal

« Reply #5 on: April 20, 2020, 04:14:30 PM »

Quote from: murphstahoe on April 20, 2020, 01:22:35 PM

Trump refilled the strategic oil reserve in March at a price of $30 a barrel ! Nice price!

Except that oil is trading at NEGATIVE one dollar a barrel now. Oil producers are literally willing to pay people to take their oil away because the wells are still spouting oil, and they have nowhere to put it. If someone will take the oil away, then they can avoid capping the wells which is even more costly than paying someone to take the oil.

Nice deal their honcho. "Nobody could have seen this coming!"

I thought the crats blocked the filling of the strategic reserve in the stimulus bill

broken clock is right twice a day i suppose

Logged

----------------------------------------------------
Inaugural Official HQ2 Tempo AOTC Award Winner
2025 - Pot stirrer of the year