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WOW! Oil prices crashed to $1.45 per barrel..Edit: $0.01 per barrel!


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That is crazy. It has good and bad repercussions. Bad: people drive more and buy bigger, less efficient cars. Good: this makes more destructive oil extraction non-profitable and discourages U.S. oil companies from taking advantage of all the formerly-protected, untouched areas that Trump opened up.

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The prices in the top link are from the oil futures market, rather than current prices. The drop is hardly unexpected though, given that demand is falling, and that there is both surplus production capacity and only limited room for bulk storage.

 

Don't expect to see similar drops in pump prices. 

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I think barrels are worth more than oil itself xD

 

We could now buy bunch of oil and fuel new Blitzkreig, no need to go for caucassus anymore, just streight for moscow.

Edited by InProgress
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It was pretty easy to see it's going to crash. With the lock down, most people fuel up once a month now and a lot of commercial traffic stopped, but i didn't see this total crash to hit so fast.:o:

Marketwatch still shows trading at......  MINUS  8.61 Dollars per barrel!

 

https://www.marketwatch.com/investing/future/crude oil - electronic

 

..and it's still falling... $-10.25

This crash will bring down US bond market.  

 

A lot of markets are going to implode.

Edited by Jaws2002
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I'm trying to figure out what a negative price on the oil futures market actually means? That come time for delivery, you'll pay someone to take it away and pipe it underground?

 

Isn't free market economics wonderful?

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That's the May20 Crude Price - everybody was diving out of the contract at any price ahead of the expiry on Monday as they didn't want to have to take physical delivery. June20 is still trading at around $20. Still pretty amazing to see. There's going to be a long economic tail from this covid-19.

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There's no more storing capacity left. The price was constantly dropping since December and they kept buying and storing it. now they can't store it no more. Oceanic tankers are sitting full with no place to drop, so companies are willing to sell at a loss, just to free their ships, rail tanks and tanker trucks.

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3 hours ago, A_S said:

so, if i buy in for 50US$ at 0.06 cents now and it goes back to 30$ i made x833 aka 41K $.. hmm

 

 

$50 bucks at $0.06 per barrel, will buy you 833 barrels of crude. That's 35,000 Gallons of crude oil. Do you have storage and transportation for that much oil? 

 

That's the main reason the futures got so bad into the negative. A lot of speculation is going. Many investors never had the intention of taking possession of that oil. They just wanted to make a quick profit and sell it again  before the end of the month, hoping the prices will go up.

 Prices dropped even more and now they had to dump it at a loss or take possession of it.

Edited by Jaws2002
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US unemployment will reach nearly 30 million people by mid-May. Thirty....f@$&ing...million, think on that for a moment. The same per-capita levels are on the cusp for the UK, FRA, GER, SPA, CHI, RUS, etc. That black swan event everyone has been making fun of that will kick off a global credit default, currency devaluation to nil, hyperinflation, and mass unemployment seems quite on point.

Then you get all the goodies that go along with it. Ya know, like breakdowns in telecom, utilities, law enforcement, medical services, and general civil unrest where people are killing each other for bottles of water and cans of soup.

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It is not a black swan, which is an "unknown unknown". A global pandemic with severe consequences has been predicted as a near certainty for years now, all that was uncertain is when, where and how it would arrive.  The pandemic is a "white swan".

 

The economic problem is not with the pandemic being unforeseen but in a system of global capitalism that actively penalizes having any redundancy in the system to cope with uncertainty. "Just in time" is optimal provided that everything works perfectly. As soon as it does not, it is the worst possible system.  

 

9 hours ago, cardboard_killer said:

 

It means that unlike milk, you cannot just pour oil down a drain when you've produced too much of it. :)

 

True, and like milk, it is not so easy to reduce oil production quickly. Not only is shutting down and later starting up wells and refineries very expensive, as is killing off your dairy herd, but as there is a market share battle going on no-one wishes to be the first to cut. Many producers, especially US shale producers, will be bankrupt if they cut production, as US shale is basically a Ponzi scheme. Of course, with a depression coming they may be bankrupt later anyway, unless the USG nationalizes or underwrites them on the grounds of national security. 

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5 minutes ago, unreasonable said:

It is not a black swan, which is an "unknown unknown". A global pandemic with severe consequences has been predicted as a near certainty for years now, all that was uncertain is when, where and how it would arrive.  The pandemic is a "white swan".

 

The economic problem is not with the pandemic being unforeseen but in a system of global capitalism that actively penalizes having any redundancy in the system to cope with uncertainty. "Just in time" is optimal provided that everything works perfectly. As soon as it does not, it is the worst possible system.  

 

 

True, and like milk, it is not so easy to reduce oil production quickly. Not only is shutting down and later starting up wells and refineries very expensive, as is killing off your dairy herd, but as there is a market share battle going on no-one wishes to be the first to cut. Many producers, especially US shale producers, will be bankrupt if they cut production, as US shale is basically a Ponzi scheme. Of course, with a depression coming they may be bankrupt later anyway, unless the USG nationalizes or underwrites them on the grounds of national security. 

 

I suppose that's correct. Nah, it is correct. We've gone beyond the concept of an unpredictable, fastidious, fluctuating market system's to one that's destined to fail given the current situation and concurrent scenarios.

 

Regardless however, my unit is now federalized and beginning its statewide deployment.

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8 hours ago, unreasonable said:

The economic problem is not with the pandemic being unforeseen but in a system of global capitalism that actively penalizes having any redundancy in the system to cope with uncertainty. "Just in time" is optimal provided that everything works perfectly. As soon as it does not, it is the worst possible system.  

 

 

   The reaction to this pandemic is what made the difference, not the pandemic, or the type of economic system a society has.

Never in history did the world commit collective economic suicide because of a virus. 

 

 I still think the pandemic is a mean to achieve something else and you don't have to be a tin foil nut job to see the society is changing right before our eyes.

 

Edited by Jaws2002
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You don't need to be a tinfoil nutjob to see that tinfoil nutjobs see absolutely everything as a 'means to achieve something else'. Accordingly, tinfoil nutjobbery has precisely zero predictive value, and thus has precisely zero utility as an analytic tool.

Edited by AndyJWest
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39 minutes ago, Jaws2002 said:

I still think the pandemic is a mean to achieve something else and you don't have to be a tin foil nut job to see the society is changing right before our eyes.

 

While it is true that some see opportunity where others see a problem (right, Victor?), implying the current events would be a happening crafted by them to use as the ingenous and fiendish plot to achive something that you wouldn't let them do otherwise is preposterous.

 

A pandemic is, by definition, never controlled. It wouldn't be a pandemic otherwise. It's a stupid idea to use a fiendish plan that by the very concept blows up it your face. The really mean guys know that.

 

2 minutes ago, Birdman said:

I should start a tinfoil hat manufacturing business in the garage, I'll have made enough to be retiring in a matter of weeks. 🤣

Man, just when I bought all this toilet paper... tinfoil...

Edited by ZachariasX
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41 minutes ago, Jaws2002 said:

I still think the pandemic is a mean to achieve something else

Certainly seems to be a very efficient way for central banks to rub their hands with glee and salivate at the thought of resetting the current global economic model. For employers to drastically reduce the future wages they will pay to their employees for governments to impose draconian measures and it also seems to be a very effective way to knock the petrodollar for six which is is the global economic hegemony. Maybe to make way for the Petroyuan or god know what else?

 

People need to read and research more than just what the main steam media is feeding them.

 

#NoTinfoilHatRequired

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@Jaws2002  No-one knows how many people have already had it, no-one knows what the long term health effects of "mild cases" will turn out to be, or whether having had it gives any immunity, or whether a vaccine is practical, so there is no way to tell what the true effects of the virus will be.  Given that, caution is rational.  It may well turn out to have been overdone, but we will only know that in a couple of years at a minimum.

 

I do think that governments have been panicked into acting, but it is not at all clear that this is the wrong thing to do.  Anyway in a democracy with the media always on the lookout for "gotcha" moments it is exceptionally difficult for governments to resist the pressure to "do something" when the opposition points at the bodies. 

 

I agree though that the effects of lockdowns can also be dire: I am finding it difficult myself.  I am retired but my income this year is likely to be nil, as is that of everyone in the GF's family unless the lockdown is lifted soon.  Having sent my GF upcountry in February I have now gone two months without touching another human being. I am not complaining - still better off than most, but I do not underestimate the ill effects of the lockdowns at all. It is driving me to drink - or it would be if the Bangkok administration had not banned alcohol sales for a month, which frankly is just taking things too far.

 

 

    

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and that is how you buy at 10cents and sell at 20US$ and x200 multiply your investment in few hours -- lucky who got it quick enough (example 500.- turns into 100.000 over a few hours)

 

 

SharedScreenshot.jpg

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35 minutes ago, Birdman said:

I should start a tinfoil hat manufacturing business in the garage, I'll have made enough to be retiring in a matter of weeks. 🤣

 

My god! It is a conspiracy.  Blue-rinsed old ladies knew about this weeks in advance and took precautions:salute:

IMG-0856.jpg

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4 minutes ago, DD_Arthur said:

 

My god! It is a conspiracy.  Blue-rinsed old ladies knew about this weeks in advance and took precautions:salute:

 

You may be on to something. 'Sidmouth' is an anagram of 'Do this, Mu'. And, as everyone knows, Mu is the name of the lost continent. Atlantis has returned!!!!

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3 minutes ago, DD_Arthur said:

Little old ladies from Atlantis?  But....but....I thought they were shape-shifting lizards......:nea:

Common misconception, they are shapeshifting little old ladies who just happen to like being lizards a lot.

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