I’ve seen some crazy swings in oil from the 70’s embargo to the 86 drop but this is some amazing stuff today
Scary as hell, for me at least. The oil patch didn’t really have a chance to recover from 2015.
I’m getting about 2 weeks to the gallon. Country getting hit from all sides.
It seems some people went into a corner situation, a day before delivery:
They cannot rollover to a longer contract, and they cannot deliver oil they do not physically own.
Hence, they must sell the contracts at any price.
I saw a post in another thread about more drillships being stacked and I was going to ask for examples…then I started reading the latest fleet status reports from April and holy s$#t !! Valaris had their biggest contract terminated early, Transocean had a contract terminated early and stacked at least one rig, Noble had contracts terminated early and several customers requesting day-rate reductions and cold-stacked a ship, a semi, and warm on some jackups, Seadrill has received a delisting warning from NYSE. This is looking like 2015 all over again but worse due to all of the other global financial issues.
Intra-day low of $0.01/barrel… Will it go negative? Amazing to watch in real time
It printed -$44 today.
Oil went to zero per barrel. Now it’s negative, meaning sellers are paying buyers to take their contracts. That’s historic and horrifying.
The price of US crude oil collapsed by 114% to [negative] $38 per barrel in a matter of hours, forcing oil producers to pay buyers to take the glut of crude which they cannot store, as rising stockpiles of crude threaten to overwhelm oil storage facilities.
Luckily this is just for the May futures contracts that expire tomorrow. June futures are still around 20. If only you had an empty tanker right now! As investors started filling idle tankers, time-charter rates over the last two months climbed from $20K/day to $40K/day to now some VLCC over $200K/day. At the lower rates the payoff on 1-2million bbl is there even if they have to sit on it for years.
Maybe it’s time USA pulled the military out of Saudi Arabia and let nature take its course?
Agree, SFL has few, if any empty VLCC’s right now. Added to a position recently I have held for many years. Hope I am right on this one.
Contango madness. Don’t invest in $USO due to contract rollover in an extreme contango situation. I wonder when it will go back to backwardation and have a positive roll yield again.
Go out and do some laps:
Especially if you are in Texas or California:
Yes, contango is madness. Gotta walk my mutt more to stay away from media downer debbies. And my bride, she is interfering in the kitchen this week. I need my space. I can only cut the grass so much.
Mine’s getting tall. Do you mind bringing your lawnmower?
LOL, only if you live farther than 6 feet and less than two blocks away. Burning more gas in it than my vehicle.
Saudi has 20 tankers of crude on the way to the USA. Arrival in May. Our friends Russia and Saudi Arabia decided to put the frackers out of their misery and they picked up an ally in Covid 19 along the way.
I feel like we’re writing a Tom Clancy novel in real-time.
USO is not an investment. You can trade it short term if you insist, but you should never hold it for any length of time.
A nice holding tank at your house hehe…
Would love to see where they are store it other than where it’s at… I have an idea but they won’t like my terminology where to put it as a gentleman.