Posted on 03/18/2020 12:12:24 PM PDT by 11th_VA
Plunging oil prices could be headed a lot lower – possibly below zero, according to one Wall Street analyst.
West Texas Intermediate crude oil, the U.S. benchmark, fell by more than 10 percent Wednesday to near $24 a barrel, a level last seen in April 2002.
“Oil prices can go negative,” wrote Paul Sankey, managing director at Mizuho Securities.
If that weren't enough, Saudi Arabia recently slashed oil prices and raised output after Russia refused to join OPEC in deepening production cuts.
Oil is a 100 million barrel-per-day market, but Sankey says it’s possible that the economic fallout from the pandemic could zap demand, creating a 20 million barrel-per-day surplus.
He says the “physical reality” of the market is that oil is pumped out of the ground and has to be consumed or stored. When the cost of storage goes high enough -- or space runs out -- companies might pay customers to take it...
(Excerpt) Read more at google.com ...
Anyone know where I can buy some 55 gallon barrels???
perfect time to top off our strategic oil reserve ...
if the distillation column and catalytic cracker in my backyard was fully functional, i’d try to sign up for some of this freebee crude oil ...
Heh, I actually saw some on TV but they were for water (plastic).
1.99 in Hollywood Florida
You must mean “peek” oil.
Peak oil has been reached, exceeded and now file thirteened about 25 years ago. More oil coming out of the ground, new fields, old fields all pumping like crazy....
You were saying?
Yes. This “stay in your homes, shelter in place” crap is MASSIVELY deflationary.
It costs more to shut wells than to keep pumping. I have two relatives in the business, one of whom just about lost his shirt in the last crash before he was able to get rid of his well.
And people are cheering about this.... SMH
This is war footing folks.
It doesn’t cost anything. But you have made an investment of a few million dollars that you are not paying off. Now, marginal wells can be lost after shut-ins. They can load up with water.
$0.25 gas will soon be a reality again!
Although you’ll need to add the taxes and transport to that number.
Typically in the midwest if you add 60 cents to the wholesale price from the commodity exchange, you get pretty close to the retail pump number.
Gas should be about a 1.30, but the best price I could find today in Indiana was 1.66.
The point of the article is that they'll pay YOU to take the oil! But you'll have to give them your bank account number. Be wary of the Nigerian oil producers though!
Gotcha beat up here in BC. It just DROPPED to $1.20/l CDN.
That’s $3.41USD/USG. For REGULAR! It was as high as $1.48/l
The 1976 Oldsmobile Delta Royale with a 455 and Thermo-flush!
No cares being made anymore.
SO in that respect, the article is correct.
“ Silly season has officially arrived.”
We’ve clearly hit peak retard.
Hopefully it will halt the deflationary pressure. This is all a very short term action to kill the panic. After it’s over they can clamp down.
I’m In Leonardtown - haven’t seen $2.19.
they only have so much storage capacity...
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