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>I am guessing that traders who are still holding on to contracts and don’t have available storage have to unload contracts pretty quickly. Good call! Now it’s

• puranjay 7y ago
  I think it briefly went negative! Let's add that to the list "Things I never thought I'd see but 2020 happened"
  • SilasX 7y ago
    Not briefly, it’s still negative and hit -$40.
    • yxhuvud 7y ago
      I think one of you are talking futures and the other physical oil. The prices are very disconnected at the moment.
• tempsy 7y ago
  It’s not that there’s no storage capacity left, it’s that if you have May contracts you are going to pay a big premium to store oil in Cushing as capacity decreases in future months. The discount reflects the storage cost premium.
  • option_greek 7y ago
    Any idea how much it takes to store oil in Cushing during normal times ?
    • donarb 7y ago
      This article from March 25 states that rates at Cushing more than doubled from 20 cents per barrel per month to 50 cents since February. https://www.reuters.com/article/global-oil-storage/global-oil-storage-fills-to-the-brim-despite-leap-in-costs-idUSL8N2BH3AM https://www.reuters.com/article/global-oil-storage/global-oi...
      • mcv 7y ago
        If storage rate is cents per barrel and barrels cost negative dollars per barrel, is sounds like storage is still very affordable.
        • HighPlainsDrftr 7y ago
          If you have an old oil field that is at end of life, couldn't you pick this stuff up at $-40.00/barrel and pump it back into the empty reservoirs? I'm sure there is regulation against it, but if it was once a production reservoir, why couldn't you store it there? You would have to drill. You wouldn't have to do much at all.
          • semi-extrinsic 7y ago
            You would need a suitable formation in terms of geological properties and then you'd need to drill and complete an injector and a producer well. Best case, you would probably lose half the stuff you're trying to store due to multiphase flow in reservoirs being a total drag. Worst case, the oil you're storing isn't compatible solubility-wise with the residual oil left in the reservoir, and you cause massive asphaltene precipitation and lose your entire storage well.
            • loa_in_ 7y ago
              The fact that such precipitation is a known fact tells me it has been tried before.
          • hermitdev 7y ago
            Can't reply to semi-extrinsic, but it would seem to me, it'd be cheaper to just shut down the originating well.
• gizmo385 7y ago
  It's at -$30 as of 1:15 Mountain...