US crude oil is suddenly worth negative money

[Matty]

😮

Historic day for oil markets as WTI crude closes below zero for first time

Of all the wild, unprecedented swings in financial markets since the coronavirus pandemic broke out, none has been more jaw-dropping than this collapse

business.financialpost.com

 

[Cougar Bait]

Saw this. Kinda weird my ZCash is worth more than oil.

 

[MrX]

Should gamelive go in on a barrel or two?

 

[Matty]

Apparently, the metal barrel itself is worth $120. Peeps are gonna dump the oil and resell the metal.

 

[CASPERWAIT$]

Does this mean that during the coronavirus, essential oil is now more important?

 

[Matty]

Does this mean that during the coronavirus, essential oil is now more important?

Go to your room.

 

[Cougar Bait]

No one is driving or flying. Low demand and a high supply.

That reminds me - don't get high on your own supply.

 

[betplom]

Wild Oil Market Sees Record Contango as Expiry Nears

I recently saw this word for the first time ever:
Contango
Had to google it.
https://en.wikipedia.org/wiki/Contango

What Is Backwardation and Contango?
https://www.jmbullion.com/investing-guide/pricing-payments/backwardation-contango/

A contango market simply means that the futures contracts are trading at a premium to the spot price.

 

[roguejuror]

@AMBy is our crude oil expert

 

[betplom]

"West Texas Intermediate crude oil futures for May delivery cratered by 305 percent to -$36.73 a barrel. "

That is a very specific product. It's not the price of the oil, per say, It is the price of a contract to take delivery of oil from a certain source at a certain time.

All the oil storage facilities that this grade can reach are full now (landlocked, so tankers aren't an option), so the last thing anyone wants is to have a contract on their hands saying they will take delivery of something they have nowhere to put.

When mid-may arrives, the people who are left holding these contracts with nowhere to put the oil will need to reneg on them, and end up paying penalties. Thus the "paying people to take the contracts off your hands" part.