4 ms·

Crude spot at $10.80 right now. 40 percent crash in an day.

by carlsborg 7y ago

coldcode 7y ago
Thats WTI, Brent is still much higher.
- Mikeb85 7y ago
  WTI is what matters most to North American producers.
  - chrisfinazzo 7y ago
    Is that correlated to the price of gas - if it ever was? I realize the above question is naive, but it's clear that the Russians and the Saudis having a pissing match over supply just as demand dries up (because COVID) has caused prices to collapse. In some places, gas is under $1/gallon.[1] [1]: https://www.cnet.com/roadshow/news/gas-prices-average-drop-kentucky-station-us/ https://www.cnet.com/roadshow/news/gas-prices-average-drop-k...
    - Mikeb85 7y ago
      Yeah gas prices mostly correlate to oil prices but also to demand for gasoline (hence the price always going up in the summer).
      - chrisfinazzo 7y ago
        I meant this more in the sense of do they look at a specific benchmark to derive how prices are set. E.g, If gas is based on WTI, then Brent can be up or down without affecting it much - Prepared to be wrong. While they aren't in lockstep, it looks like they play off each other most of the time. As you say, seasonality has a role and demand for heating oil v gas depends on the time of the year.
        Mikeb85 7y ago
        Gasoline is one of many products produced from crude (others include kerosene, diesel, heating oil, butane, propane, plastics, etc...). You can also get a different mix of products depending on the grade of oil and refining technique, so gasoline has its own supply/demand dynamics which partially intersects with demand curves for the other products while crude is merely the input. So cheap crude does allow more room to lower the price of gasoline and cheap crude is often linked to lower demand, however they're not in lockstep due to the many other factors.
- Danieru 7y ago
  Brent would not be impacted by storage in America, since Brent is a product of the oilfields near the old Brent oilfield in north Europe. Which brings up the topic of oil prices: there are many. Every blend, every location, has its own price. In fact the same oil can be sold at different prices if the seller so chooses. Of note Saudis have reportadly raised the price they offer americans as part of the deal, while lowering the price to asia. Which leads to the saying:"In equity the algorithms are a secret and the prices are known, in oil the prices are a secret and the algorithms are public." News can only talk about WTI or Brent, but exact prices at each market depend upon situations.
  - SilasX 7y ago
    >Which brings up the topic of oil prices: there are many. Every blend, every location, has its own price. In fact the same oil can be sold at different prices if the seller so chooses. True but largely irrelevant. WTI is a widely-cited benchmark because all those oil prices are highly correlated and so it's a good general measure.
    - stevesimmons 7y ago
      Highly correlated, in normal market conditions!
      - SilasX 7y ago
        And most abnormal ones. Even now they're correlated. And when e.g. one region has abnormalities, it doesn't really affect the purpose most people use this measure for.
zitterbewegung 7y ago
Yea, the price keeps on going down and Bloomberg is updating the title very quickly. Dunno how you would handle this situation on HN (same thing happens with other volatile assets).
yingw787 7y ago
I pay more for a Chipotle burrito (with guac of course, can't live without guac). This is incredible.
- koheripbal 7y ago
  ... but you don't have a barrel to put it in, do you?
  - yingw787 7y ago
    No barrel needed, I just eat it when it's hot and fresh
- lonelappde 7y ago
  A barrel of crude has always cost less than a barrel of burritos.
  - yingw787 7y ago
    I can't drink crude without dying
lonelappde 7y ago
OP article now says under $5

Crude spot at $10.80 right now. 40 percent crash in an day.

coldcode 7y ago

Thats WTI, Brent is still much higher.

Mikeb85 7y ago
WTI is what matters most to North American producers.
- chrisfinazzo 7y ago
  Is that correlated to the price of gas - if it ever was? I realize the above question is naive, but it's clear that the Russians and the Saudis having a pissing match over supply just as demand dries up (because COVID) has caused prices to collapse. In some places, gas is under $1/gallon.[1] [1]: https://www.cnet.com/roadshow/news/gas-prices-average-drop-kentucky-station-us/ https://www.cnet.com/roadshow/news/gas-prices-average-drop-k...
  - Mikeb85 7y ago
    Yeah gas prices mostly correlate to oil prices but also to demand for gasoline (hence the price always going up in the summer).
    - chrisfinazzo 7y ago
      I meant this more in the sense of do they look at a specific benchmark to derive how prices are set. E.g, If gas is based on WTI, then Brent can be up or down without affecting it much - Prepared to be wrong. While they aren't in lockstep, it looks like they play off each other most of the time. As you say, seasonality has a role and demand for heating oil v gas depends on the time of the year.
      - Mikeb85 7y ago
        Gasoline is one of many products produced from crude (others include kerosene, diesel, heating oil, butane, propane, plastics, etc...). You can also get a different mix of products depending on the grade of oil and refining technique, so gasoline has its own supply/demand dynamics which partially intersects with demand curves for the other products while crude is merely the input. So cheap crude does allow more room to lower the price of gasoline and cheap crude is often linked to lower demand, however they're not in lockstep due to the many other factors.
Danieru 7y ago
Brent would not be impacted by storage in America, since Brent is a product of the oilfields near the old Brent oilfield in north Europe. Which brings up the topic of oil prices: there are many. Every blend, every location, has its own price. In fact the same oil can be sold at different prices if the seller so chooses. Of note Saudis have reportadly raised the price they offer americans as part of the deal, while lowering the price to asia. Which leads to the saying:"In equity the algorithms are a secret and the prices are known, in oil the prices are a secret and the algorithms are public." News can only talk about WTI or Brent, but exact prices at each market depend upon situations.
- SilasX 7y ago
  >Which brings up the topic of oil prices: there are many. Every blend, every location, has its own price. In fact the same oil can be sold at different prices if the seller so chooses. True but largely irrelevant. WTI is a widely-cited benchmark because all those oil prices are highly correlated and so it's a good general measure.
  - stevesimmons 7y ago
    Highly correlated, in normal market conditions!
    - SilasX 7y ago
      And most abnormal ones. Even now they're correlated. And when e.g. one region has abnormalities, it doesn't really affect the purpose most people use this measure for.

zitterbewegung 7y ago

Yea, the price keeps on going down and Bloomberg is updating the title very quickly. Dunno how you would handle this situation on HN (same thing happens with other volatile assets).

yingw787 7y ago

I pay more for a Chipotle burrito (with guac of course, can't live without guac). This is incredible.

koheripbal 7y ago
... but you don't have a barrel to put it in, do you?
- yingw787 7y ago
  No barrel needed, I just eat it when it's hot and fresh
lonelappde 7y ago
A barrel of crude has always cost less than a barrel of burritos.
- yingw787 7y ago
  I can't drink crude without dying

lonelappde 7y ago

OP article now says under $5