Posted on 03/09/2020 10:09:09 AM PDT by Oldeconomybuyer
NEW YORK - Oil prices crashed on Monday, suffering their biggest daily rout since the 1991 Gulf War, after the collapse of an OPEC+ supply agreement that now threatens to overwhelm the world with oil, inciting panic throughout the energy sector.
After failing to come to an agreement to cut supply, Saudi Arabia and Russia over the weekend pledged instead to ramp up production, which could quickly flood global markets with oil at a time when demand has already weakened substantially.
The market’s reaction has been furious, with crude futures plunging by nearly 20%, while energy stocks collapse as shale producers frantically cut future expenditures in anticipation of a drastically different outlook than a few days ago.
Should these losses hold, it would be the biggest one-day percentage decline for both benchmarks since Jan. 17, 1991, the outset of the U.S. Gulf War, when it fell by a third.
A three-year supply pact between members of the Organization of the Petroleum Exporting Countries, which includes the group’s top producer Saudi Arabia, and Russia fell apart on Friday after Moscow refused to support deeper oil cuts to cope with the outbreak of coronavirus.
OPEC responded by removing all limits on its own production, prompting fear of a supply hike in a market already awash with crude.
Despite sliding demand for crude due to the coronavirus, Saudi Arabia plans to boost its crude output above 10 million barrels per day (bpd) in April after the current deal to curb production expires at the end of March, two sources told Reuters on Sunday. Saudi Arabia also cut its official crude selling price.
(Excerpt) Read more at reuters.com ...
lol yup- i just said that same thing- i didn’t read through the thread first-
[[the longer you can wait to fill them the better when pricing are collapsing. ]]
Not aROUDN HERE- AT BEST WE MIGHT FALL ANOTHER 2-3 CENTS A GALLON IN A WEEK OR TWO- cps lock srry- just in time for the prices to rise again- then our gas prices will rise immediately- my state rips us off- big time-
Better some pain here in exchange for a lot of pain for Russia, Iran, VZ and other Kelptocracies.
Of course, the Consumer does best with cheap energy.
Not just the mullah’s in Iran but the bus driver in Venezuela.
Between COVID-19 hitting their leadership, sanctions and a tanking of oil prices how much more can that system absorb and endure?
At $33 a barrel, shouldn’t gasoline prices be down to under $2.00? Seems i remember way back when oil was around $2 barrel, and gas was around $1.70-.80 or so? We’re still at $2.83 right now
Gas is 1.85 here in Indiana and our state is top 10 in fuel taxes. So maybe you’re someplace where the gov mandates “special” fuels.
“The timing of this is sure interesting.”
It is on a few tings....the virus stuff and the media fanning of every conceivable issue to stir up trouble and now this.
Puts on his tin foil hat....CIA anyone?
Removes his tin foil hat... I know it sounds strange but the odd air of coincidence and these events is starting to add up.
What I said.
So why do we call Saudi Arabia an ally, train their pilots, and, even worse, are sending US troops there? They hate us and always have.
Wow- that’s a dollar less per gallon- for every 100 gallons, we’re paying $100 more than you folks are- Lovely- I don’t know about special gas- we have the stupid corn crap in the gasoline- i know that-
If you have a 1,000-gallon tank of gasoline at your shop and you paid $1.50 per gallon for it, you've got $1,500 worth of inventory in the ground. If you sell 1,000 gallons per day and you need to earn a profit of $500 per day to pay the bills, then you're selling that gasoline for $2.00 per gallon just to break even.
1. If your supplier tells you that the wholesale price of gasoline has dropped to $1.00 for your next delivery, you still have to make the $500 on the gasoline you have in the tank ... so your price doesn't change at all until your next delivery.
2. If your supplier tells you that the wholesale price of gasoline has INCREASED to $2.00 for your next delivery, you must immediately raise your price to cover the higher cost -- because you need will $2,000 just to refill your tank, and if you keep selling your 1,000 gallons for $2.00/gallon then you won't have enough revenue to cover any other costs of doing business.
With the money we save on gas MSNBC is predicting we will save close to a million dollars a person.
I don’t have stats but Indiana is corn country so I’d think 99% plus of the gasoline sold here is E10 blend.
I've been wondering if that rounding up of various Saudi princes is part of a cost reducing scheme.
How many times has your state raised taxes since then?
Everytime gas prices fall it gives them an excuse to raise taxes
When oil prices plunge it takes weeks for the price to go down, when oil prices rise gas prices go up within the hour.
I know, right? Funny how that works, isn’t it?
When in college 30 years ago we were told by the leftist, socialist, progressive communist professors that we only had 30 years left before we ran out of oil. Kind of like the Greta and AOC profititess’s that we only have 11 years till the world ends, due to globull warming.
The sky is falling
“This could take down the Mullahs and it might be the real target for this Saudi action.”
Will also destroy whatever is left of Venezuela.
Agreed. But Iran is not a full competitor to the Saudis as they sell a lot of natural gas.
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Iran is heading for collapse and revolution.
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The ruling class is being destroyed by corona virus.
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Oil prices collapsing. The unrest is getting critical.
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