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Thread: US running out of room to store oil; price collapse next?

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    US running out of room to store oil; price collapse next?

    US running out of room to store oil; price collapse next?

    For the past seven weeks, the United States has been producing and importing an average of 1 million more barrels of oil every day than it is consuming. That extra crude is flowing into storage tanks, especially at the country's main trading hub in Cushing, Oklahoma, pushing U.S. supplies to their highest point in at least 80 years, the Energy Department reported last week.

    If this keeps up, storage tanks could approach their operational limits, known in the industry as "tank tops," by mid-April and send the price of crude and probably gasoline, too plummeting.
    How about some $1.25 gasoline? Just in time for summer!

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    Re: US running out of room to store oil; price collapse next?

    Quote Originally Posted by Erod View Post
    How about some $1.25 gasoline? Just in time for summer!
    Economic ruin and loss of jobs, just in time for summer.

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    Re: US running out of room to store oil; price collapse next?

    Quote Originally Posted by Erod View Post
    US running out of room to store oil; price collapse next?

    How about some $1.25 gasoline? Just in time for summer!
    The end of the article points to the issue, matching supply to demand in future months. Namely, why it is unlikely that Oil will fall enough to get $1.25 per gallon gas. But for traders why it is unlikely that Oil will fall to $20 bbl.

    We already know that there is more inventory rise for oil, but we also know that both gas and diesel inventories have fallen. Which explains why Oil prices are maintaining but gas prices are on the rise from the January time frame.

    Also, Oil price futures are still pointed upwards. If there was enough concern what is called "tank tops" we would already see speculation take Oil futures downwards.

    As of writing this response by contract month, for the next 6 months, in today's speculation...

    April: $50.37
    May: $52.37
    June: $54.00
    July: $55.45
    August: $56.71
    September: $57.83

    For any month in the next six months I see almost no strike offerings for Oil in the $20 bbl - $30 bbl. Most of the active volume being traded as of today for the next six month's worth of contracts is still between $40 bbl to as high as $70 bbl. Granted, some of this is pressure by source but overall there is very little trading suggesting another collapse in Oil given what we know thus far.

    I am stuck with a previously offered conclusion when $20 bbl came up a few weeks ago. Until another major economic movement causes it, what we have thus far does not suggest another round of Oil price drops. Oil prices would shy towards $45 bbl to $50 bbl if conditions stay as is, but we know that is not the case given demand for diesel and gas is already on the rise to some degree.

    ..........

    BTW, the price for April 2015 contracts just shot up to $50.42 and is still up from the previous day's close of $49.59. Again, if this article was entirely accurate we would already see trading for future months turn negative on stock Oil supplies. But every single month going out 6 months is up today, in fact so is the entire next year. (I checked once again before hitting reply.)
    "Every time something really bad happens, people cry out for safety, and the government answers by taking rights away from good people." - Penn Jillette.

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    Re: US running out of room to store oil; price collapse next?

    Quote Originally Posted by Carjosse View Post
    Economic ruin and loss of jobs, just in time for summer.
    Cheaper gas, cheaper groceries, cheaper vacations, cheaper operating costs.....does not equal loss of jobs and economic ruin. At least not in a capitalist economy.

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