Can somebody please explain here what does it mean when the oil price is in the negative, because googling it is just making me more confused. Is this for future contracts? For now? Are some companies actually paying to have their oil moved? What the hell is going on?
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We’re going to dump it into the Red River. Who’s going to stop us, dotard’s EPA?
BWAHAHAHAHAHA
It means nobody wants your barrels because they don't have a place to put it. So you have to pay someone to store it.
Oh ya, don't try dumping it in the ocean, BP tried that a decade ago. Ended up costing them about $11,000 per barrel!
I think it also means the buyers do not want to take control of the oil because there are no storage capacity left, so the buyer is paying to not take the oil. This is because all the storage facilities are full and there literally is no where to put the oil. In some cases there are tankers floating around in the oceans full of oil because people are using them to store the oil. The buyer just does not want to take the product.
I did see where the government may open the US oil stock facilities to take some of the oil and the buyer would pay them for the storage. Also, keep in mind this is for the May contracts, and June prices should go up, but with this negative pressure the June prices may fall right back.
Until the US economy gets going again there is going to be a surplus, and the oil business is going to hurt. Once people go back to work and start using fuel we will see the inventory drawn down, but that will be a while with so much surplus. These are really unprecedented times and it will take a long time to get the oil business back to normal. The economy has to pick up for us to survive, so we need to find a way to live with this virus.
Technically when prices go negative you have to conduct more refining. Refinement of our resumes more specifically.