jrober38 Posted April 20, 2020 Share Posted April 20, 2020 Texas just went out business. So much for the deal Trump touted a week ago between Saudi Arabia and Russia. What a colossal disaster. 1 Link to comment Share on other sites More sharing options...
Deranged Rhino Posted April 20, 2020 Share Posted April 20, 2020 Just now, jrober38 said: Texas just went out business. So much for the deal Trump touted a week ago between Saudi Arabia and Russia. What a colossal disaster. Your analysis is -- once again -- incorrect and based solely on FEELz in the moment. Link to comment Share on other sites More sharing options...
TPS Posted April 20, 2020 Share Posted April 20, 2020 1 minute ago, Buffalo_Gal said: Crazy. Negative $8!? I hope the Feds are "buying" whatever is out there. They can take the full trains, any tanker, etc. I know the strategic reserve is nearly full, but ... I hope gas prices reflect this in the next few days.... hmmm.... negative $0.25 per gallon...? ? 1 2 Link to comment Share on other sites More sharing options...
Buffalo_Gal Posted April 20, 2020 Share Posted April 20, 2020 1 minute ago, jrober38 said: Texas just went out business. So much for the deal Trump touted a week ago between Saudi Arabia and Russia. What a colossal disaster. You might want to sit this one out, sport. 2 Link to comment Share on other sites More sharing options...
jrober38 Posted April 20, 2020 Share Posted April 20, 2020 Just now, Buffalo_Gal said: You might want to sit this one out, sport. Why? The world has hit its capacity in terms of how much oil they can store. Unless everyone turns off the taps, this is just going to continue getting worse. They are literally paying people to take oil off their hands. Link to comment Share on other sites More sharing options...
TPS Posted April 20, 2020 Share Posted April 20, 2020 negative $38 Link to comment Share on other sites More sharing options...
Deranged Rhino Posted April 20, 2020 Share Posted April 20, 2020 1 minute ago, jrober38 said: Why? 1 Link to comment Share on other sites More sharing options...
jrober38 Posted April 20, 2020 Share Posted April 20, 2020 Just now, TPS said: negative $38 Some hedge funds will be going out of business tonight. Some people's savings will have just been wiped out. Link to comment Share on other sites More sharing options...
Buffalo_Gal Posted April 20, 2020 Share Posted April 20, 2020 2 minutes ago, TPS said: negative $38 !!!!!! Ok, I am scraping the sofa for pocket change and calling my buddy Boris to see if he still has that old Russian tanker... 1 Link to comment Share on other sites More sharing options...
keepthefaith Posted April 20, 2020 Share Posted April 20, 2020 4 minutes ago, TPS said: I hope gas prices reflect this in the next few days.... hmmm.... negative $0.25 per gallon...? ? I just got the summer car out last week which guzzles 93 octane (but meets fed emissions standards). Looking forward to cheap gas and longer rides home. 1 Link to comment Share on other sites More sharing options...
/dev/null Posted April 20, 2020 Share Posted April 20, 2020 i know we're only supposed to focus on negative stuff lately, but to be contrarian i'm going to look on the bright side. most people equate oil with gasoline. while they're not wrong, oil (petroleum) is used in a large number of manufactured products, such as plastics, polymer, and fabric. now is a great time for manufacturers to stock up on oil. when this corona virus crises passes (as all crises do) they will be set up for a manufacturing boom and we as consumers will benefit from lower prices 1 Link to comment Share on other sites More sharing options...
jrober38 Posted April 20, 2020 Share Posted April 20, 2020 2 minutes ago, /dev/null said: i know we're only supposed to focus on negative stuff lately, but to be contrarian i'm going to look on the bright side. most people equate oil with gasoline. while they're not wrong, oil (petroleum) is used in a large number of manufactured products, such as plastics, polymer, and fabric. now is a great time for manufacturers to stock up on oil. when this corona virus crises passes (as all crises do) they will be set up for a manufacturing boom and we as consumers will benefit from lower prices A few things. 1. Companies aren't ready to store oil. It's trading in negative territory because the world storage capacity has been reached. 2. The manufacturing industry is going to be hit hard when all the people who work in oil and gas are laid off. Link to comment Share on other sites More sharing options...
Deranged Rhino Posted April 20, 2020 Share Posted April 20, 2020 Just now, jrober38 said: A few things. 1. Companies aren't ready to store oil. It's trading in negative territory because the world storage capacity has been reached. 2. The manufacturing industry is going to be hit hard when all the people who work in oil and gas are laid off. I look forward to this being proven wrong, as is fated with all @jrober38 declarations. Link to comment Share on other sites More sharing options...
keepthefaith Posted April 20, 2020 Share Posted April 20, 2020 23 minutes ago, TPS said: negative $38 So how can the airlines benefit from this? I know they buy fuel contracts way in advance, years. I suppose those agreements can only be cancelled with some termination cost and their consumption is way down meaning even greater obligations remaining? That industry will certainly need some help. Link to comment Share on other sites More sharing options...
jrober38 Posted April 20, 2020 Share Posted April 20, 2020 (edited) 5 minutes ago, keepthefaith said: So how can the airlines benefit from this? I know they buy fuel contracts way in advance, years. I suppose those agreements can only be cancelled with some termination cost and their consumption is way down meaning even greater obligations remaining? That industry will certainly need some help. Most airlines hedge their fuel costs so there's likely no benefit short term. Until they start filling planes with passengers again they're screwed. Edited April 20, 2020 by jrober38 Link to comment Share on other sites More sharing options...
Nanker Posted April 20, 2020 Share Posted April 20, 2020 2 hours ago, Buffalo_Gal said: Crazy. Negative $8!? I hope the Feds are "buying" whatever is out there. They can take the full trains, any tanker, etc. I know the strategic reserve is nearly full, but ... Pelosi cut the funds out of the recovery bill because she refused to bail out “Big Oil.” Of course our strategic reserves are purchased from small domestic suppliers. Interestingly enough, those reserves are sold from time to time to fund federal legislative projects. 1 Link to comment Share on other sites More sharing options...
Foxx Posted April 20, 2020 Share Posted April 20, 2020 (edited) 3 hours ago, TPS said: Hope you didn't buy any ETFs after that last discussion. Btw, @Foxx you nailed it. USO and other oil ETFs will dissolve this week, unless they have a friend in the WH.... They are now paying investors to accept bids on their May contracts so they can close their positions without having to take delivery--which they are incapable of. If they want to continue as an ETF, they'd have to buy the June at $21. Negative $8.50 and falling... 3 hours ago, TPS said: negative $38 On 3/29/2020 at 7:19 PM, Foxx said: won't be long before we won't be able to store it. so much so that, will we see negative prices on a barrel? The oil glut is filling up the world’s supertankers fast The world’s oil tankers are being filled with crude at a record pace as the options to store a glut on land rapidly diminish, one of the industry’s largest owners said. A combination of surging production from key producers worldwide and capitulating demand in the face of the coronavirus outbreak means that land storage is being overwhelmed, said Robert Hvide Macleod, Chief Executive Officer of Frontline Management AS. The world is likely overproducing by about 20 million barrels a day, or 20% of normal consumption, he said, echoing wider industry views. ... thanks for the shout out, TPS. at market close, the price was, -$32.14. it has rebounded in after hours trading to where it stands right now at, -$15.60. this is the last day of May trading, not exactly sure when the time is but come tomorrow we will be trading June delivery. if you have a May contract, your most definitely in the hole. how many bankruptcies are we going to see because of this? shorts are making a killing. of course the DOW was down for the day most likely because of the precipitous oil drop. it is going to be interesting to see where oil goes from here because there is literally nowhere to store it. you just can't plow under raw crude without having massive fines, lawsuits and environmental cleanup costs. the contracts out through to Jan '21 are all in positive territory right now, from $21.25 for June delivery to $33.11 for Jan '21 delivery. the coming week is going to be an interesting watch, not only for oil but the DOW and S&P. back below 20K and 2500 respectfully? Edited April 20, 2020 by Foxx 1 Link to comment Share on other sites More sharing options...
TPS Posted April 20, 2020 Share Posted April 20, 2020 4 minutes ago, Foxx said: thanks for the shout out, TPS. at market close, the price was, -$32.14. it has rebounded in after hours trading to where it stands right now at, -$15.60. this is the last day of May trading, not exactly sure when the time is but come tomorrow we will be trading June delivery. if you have a May contract, your most definitely in the hole. how many bankruptcies are we going to see because of this? shorts are making a killing. of course the DOW was down for the day most likely because of the precipitous oil drop. it is going to be interesting to see where oil goes from here because there is literally nowhere to store it. you just can't plow under raw crude without having massive fines, lawsuits and environmental cleanup costs. the contracts out through to Jan '21 are all in negative territory right now, from -$3.78 for June delivery to -$1.16 for Jan '21 delivery. the coming week is going to be an interesting watch, not only for oil but the DOW and S&P. back below 20K and 2500 respectfully? Are you sure about those prices? Those look like the changes not the contract values? I mentioned oil ETFs up thread, but they can't be the reason because they "roll" out of their contracts the week before the expiring date, so it's going to be interesting to see who the long speculators are who got caught in the long squeeze. Maybe some inexperienced Hedgies? At any rate, those ETFs and Index Funds are still going to lose big time since they are "selling low and buying high," the negative roll yield in contango markets. If anyone comes across any articles on who the losers are, I'd appreciate a notification. I did read one thing that argued it was USO, but I looked at their roll dates (when they start selling the expiring May contract and buying the June contract), and they were April 7 through the 13th. They weren't sellers today (All of the institutional funds roll out at least the week before the contract expires). Interesting times... 1 Link to comment Share on other sites More sharing options...
Foxx Posted April 20, 2020 Share Posted April 20, 2020 17 minutes ago, TPS said: Are you sure about those prices? Those look like the changes not the contract values? I mentioned oil ETFs up thread, but they can't be the reason because they "roll" out of their contracts the week before the expiring date, so it's going to be interesting to see who the long speculators are who got caught in the long squeeze. Maybe some inexperienced Hedgies? At any rate, those ETFs and Index Funds are still going to lose big time since they are "selling low and buying high," the negative roll yield in contango markets. If anyone comes across any articles on who the losers are, I'd appreciate a notification. I did read one thing that argued it was USO, but I looked at their roll dates (when they start selling the expiring May contract and buying the June contract), and they were April 7 through the 13th. They weren't sellers today (All of the institutional funds roll out at least the week before the contract expires). Interesting times... you are correct. long day here and though i know better, i just saw the red. let me edit my post. thanks. if i come across articles regarding this, which i'm sure there will be plenty, i will post. 1 Link to comment Share on other sites More sharing options...
Foxx Posted April 20, 2020 Share Posted April 20, 2020 (edited) there is a small possibility here is that it is a long squeeze. if it is indeed, the shorts may be waiting for the bankruptcy courts to settle. however more than likely it is because the players are paying them to not take delivery because they have nowhere to put it. interesting times to be sure. Edited April 21, 2020 by Foxx Link to comment Share on other sites More sharing options...
Recommended Posts