Negative Oil Prices
- Thread starter Munroast
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It's because it costs money to move oil from some locations, they have no storage drums spare and you can't just turn off the tap instantly. Or because someone failed to count correctly.
it just means over supply with fixed costs and limited storage means losses or greatly reduced income whilst wages and other costs can exceed profits
in the end costs supply and demand will dictate the cost but no one sells at a loss for more than a very short time
in the end costs supply and demand will dictate the cost but no one sells at a loss for more than a very short time
I think I’ll get some. What is it at the moment, minus $40 a barrel? So, they’ll give me the oil and $40 per barrel. I’ll just clear a bit of space at the back of my garden and I’ll give them a call. 
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Cost of storage is greater than the current value of the product.
There is also a global shortage of tankers.
There is also a global shortage of tankers.
I had the same idea and just phoned Exxon Mobil to order some. It's true, the good news is that the oil is free, but they want $100 for the barrel - which is a bit of a con.I think I’ll get some. What is it at the moment, minus $40 a barrel? So, they’ll give me the oil and $40 per barrel. I’ll just clear a bit of space at the back of my garden and I’ll give them a call.
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It’s too late now. Prices back up
Only $1.25 a barrel. Down from about $150
E
EddieM
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take it without the barrel and just burn it - in fact why don't the oil ginats just do that, pump it into a lake and set fire to it. Surely they're not scared of annoying Greta.
But getting back to my original question, is it not possible t just stop it coming out of the ground ? can they just not turn the tap off for a bit, is it just more complicated than that and if so, how?
D
durhamplumber
Top bellend idea
remember this is only a very very small amount off the oil most is fixed in at a set price for a set amount for now and months and years to come
think off it as a saturday market stall where they make good money during the day towards the end they drop the prices to shift stock if sales are slow
now at the end off the day they just dump what they cant sell as it wont keep
now imagine you now have to pay to dispose off it at a rate off £1 a kg selling the disposal risk to a local restaurant or food bank at 50p you overheads have been reduced but you have still sold 95% at a great to good profit with someone else taking the risk that the cost off disposing off food wont increase to £2 or£3 through supply and demand on what they cant use
think off it as a saturday market stall where they make good money during the day towards the end they drop the prices to shift stock if sales are slow
now at the end off the day they just dump what they cant sell as it wont keep
now imagine you now have to pay to dispose off it at a rate off £1 a kg selling the disposal risk to a local restaurant or food bank at 50p you overheads have been reduced but you have still sold 95% at a great to good profit with someone else taking the risk that the cost off disposing off food wont increase to £2 or£3 through supply and demand on what they cant use
It's simple really.Recently Russia and Saudi had a battle. Russia started selling oil at a reduced price. I noticed the drop in the price at the pumps. Russia did it by producing more so price fell. They shook hands and then agreed a limited production. Price then goes up. Looks like less than it was earlier at the moment but it can take a time to work through.
So lockdowns all over the place, no one buying fuel so way too much around to sell and price falls. So store as much as possible and probably fill every tanker on the planet and leave it at sea.
There aim usually is to produce just enough for demand which keeps the price more stable and OPEC sets that price. The USA did just produce for themselves. Not sure what they do now.
Crazy, what - but that in some ways is how a number of things work.
So lockdowns all over the place, no one buying fuel so way too much around to sell and price falls. So store as much as possible and probably fill every tanker on the planet and leave it at sea.
There aim usually is to produce just enough for demand which keeps the price more stable and OPEC sets that price. The USA did just produce for themselves. Not sure what they do now.
Crazy, what - but that in some ways is how a number of things work.
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wouldn't put it past an oil executive
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