There is so little driving and flying happening that we’re running out of room to store the unused oil.
. In practical terms, this means that anybody who is supposed to receive a shipment of American crude but doesn’t want it will have to pay somebody else to take it.
How come? Because we are literally running out of places to put all of the extra oil we’re not using, because people have stopped driving, flying, or living any semblance of normal life while the country descends into a state of coronavirus-induced catatonia. As the Wall Street Journal: “The historic low price reflects uncertainty about what buyers would even do with a barrel of crude in the near term.
between Russia and Saudi Arabia to cut production and stabilize prices. Good try, good effort, I guess.still willing to pay positive sums of money for crude delivered later in the year. Contracts for June closed the day above $20 a barrel, which suggests that traders expect the current glut to ease up a bit, either due to further production cuts or because they think the economy will have recovered ever so slightly by then.
“It’s like some movie from the 1980s where the U.S. president and the Soviet premier come to an agreement” to halt a nuclear war, “[but] one plane missed the call back,” said one industry official tracking the ships but was not authorized to speak to the press. Anyway, a prolonged oil bust is going to have a devastating effect on energy jobs across the United States, while low prices could make it difficult to transition away from fossil fuels in order to save the planet from melting. And if you’ve got a shipment of crude coming in, get used to saying the words, “Take my oil, please.”Readers like you make our work possible. Help us continue to provide the reporting, commentary and criticism you won’t find anywhere else.
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