Making the news today....

[trigger_andy]

3 hours ago, Toad said:

A large problem will be at the refineries, you can't just stop them and restart again when there is more demand. The lack of petrochemical consumption will mean that the refineries will have been filling storage tanks but will be reaching the end of their capacity. In the UK tankers can be used as extra floating storage, but this again is only finite.

 

I think the problem in the states is also to do with futures trading where people buy and sell barrels but only really on paper, they don't have anywhere to put the oil just rely on the fact they can sell it on between ordering and delivery, now they don't have anywhere for it to go.

This about sums it up.  

 

West Texas Intermediate futures are trading at -$38 a barrel, which is astounding really. I dont really understand all the futures trading to be honest. But its not looking good at all.

 

Brent Crude, which covers the UK and Norwegian oil produced is still trading at $25 a barrel. Im not sure what the knock on effect will be over here? 

 

We've been really busy in Q1 for installing new Wells here in Norway with Q2 getting even more busy and Q3 & Q4 looking to be very busy for us too. Lots of projects for Drilling on-going and its dificult to just suddenly stop. Semi-Submersible and Jack-Up Rigs are on 1 year and 2 year contracts. Sometimes just 1,2 or 3 well contracts though. The Rig Im on just now is rented by the oil company for $350,000 a day, its on a two year contract. All the equipment to Complete this years Well's have been bought and at least partially paid for. I'll assume its simply cheaper to continue operations and hope we come out the other side of this soon. 

 

Interesting times for sure. 

 

Edit, I was just reading this; 

 

 

How did you end up with negative oil prices today? This happens when a physical futures contract find no buyers close to or at expiry. Let me explain what that means:

1. A physical contract such as the NYMEX WTI has a delivery point at Cushing, OK, & date, in this occurrence May. So people who hold the contract at the end of the trading window have to take physical delivery of the oil they bought on the futures market. This is very rare.

2. It means that in the last few days of the futures trading cycle, (which is tomorrow for this one) speculative or paper futures positions start rolling over to the next contract. This is normally a pretty undramatic affair.

3. What is happening today is trades or speculators who had bought the contract are finding themselves unable to resell it, and have no storage booked to get delivered the crude in Cushing, OK, where the delivery is specified in the contract.

 

 

. This means that all the storage in Cushing is booked, and there is no price they can pay to store it, or they are totally inexperienced in this game and are caught holding a contract they did not understand the full physical aspect of as the time clock expires

 

5. The contract roll and liquidity crunch that made the extreme sell-off today possible but it DOESN’T necessarily represent futures market conditions: NYMEX June settled today at $21.13

6. The June contract is not out of the woods either: today’s action indicate that physical oil markets at Cushing are not in good shape and that storage is getting very full.

7. A decline of over 15% in the June contract price points to real worries that the physical stress will continue to reverberate, and will force a lot more production shutdowns during May than the ones announced so far.

8. So today negative prices are the reflection of dire market conditions for producers, with the hope that demand restart before the middle of May and that the June contract does not face the same fate.

Edited April 21, 2020 by trigger_andy

[donnk]

9 hours ago, AHPP said:

The 20% when sold is what I described when the banks repossess and sell. Unless I've missed some other subtlety?

only if you took out a 20% H2B contribution, otherwise it just mirrors the deposit taken, 5%, 10% etc

 

They cant take more than they loaned as an initial %.

[Woodworks]

On 20/04/2020 at 11:00, tree-fancier123 said:

and you don't think the current government hasn't been through academia with a fine tooth comb looking for people who can at least partially understand these phenomena. Personally I don't think the advisers they have used either in government, or those in universities could have been any better. Remember all over the world scientists have been at odds over how to manage this.

There are 3 main points

1 - lockdowns clearly slow the spread, the more complete the lockdown the better

2- shutting most of the economy for more than a few weeks may well cause more long term suffering than just letting people die and carrying on, with mass burials of those who don't make it. Putting financial strength and natural selection before compassion (hope they don't do this as I'm asthmatic and not looking forward to atypical pneumonia). The thing is the financial impact of the lockdown will suck wealth from the many to save the few who wouldn't survive the disease. We do this because we are compassionate. 

3 - related to point 2, and very much realating to your point about hiring the best experts is the idea of herd immunity, now this is something nearly all experts agree on, but how to go about it is where they differ. I suppose a vaccine is artifical herd immunity, but it doesn't yet exist.

Look at todays graph from the Uk gov Covid 19 dashboard, the government has listened to the best people and tried very hard to discriminate the relevant information. Chris Witty and his colleagues in the medical schools and universities have served us well - it's looking under control

Sure a total lockdown a month earlier, including sea and land ports would have saved lives, but without significant hospital deaths being reported there would have been low acceptance of infringement of civil liberty and shuttering almost the entire economy.

Just look at those charts - that is success, not failure. I say well done to all. No one alive has had to deal with shit like this before, so don't expect the PM to get every last detail right. Surely even an ex drug user would agree Boris is miles better than Trump? I know even my partially distorted reformed druggie brain can see that Boris is pretty good at this crisis. And in the past I've voted Labour, Green and Conservative. It would have been Conservative again before Christmas, but I had a broken ankle and it was a done deal so I put my feet up and abstained.

Interesting graph but not seen any others that give me much hope rather the opposite. All I see is the UK public dont understand about avoiding contacts as our case levels have barely dropped while many of our European compatriots get it and have considerably lowered their cases. If we dont come into contact with others we cant catch it. Do that for three weeks and it's gone. If we keep on being so daft we wont get infection rates down so will find it hard to lift lockdown.

[tree-fancier123]

57 minutes ago, Woodworks said:

Do that for three weeks and it's gone. If we keep on being so daft we wont get infection rates down so will find it hard to lift lockdown.

children of key workers still in school, key workers commuting, supermarket distancing a joke, flights still arriving without temperature checks on entry

even so the daily hospital deaths hasn't been above a thousand yet, Nightingale hospital virtually empty.

[donnk]

on the bright side the shitholes that are london and birmingham is getting cleaned out a bit. 

 

Could maybe order the RAf to carpet bomb both to kill the virus and corona at the same time.

[tree-fancier123]

So

11 minutes ago, donnk said:

on the bright side the shitholes that are london and birmingham is getting cleaned out a bit. 

 

Could maybe order the RAf to carpet bomb both to kill the virus and corona at the same time.

what do you even mean kill the virus and corona ay the same time? You and Eggs - your posts are a bit like AI chat bots. Perhaps webmasters are investing in them to keep post count averages up

[Mark J]

13 minutes ago, tree-fancier123 said:

So

what do you even mean kill the virus and corona ay the same time? You and Eggs - your posts are a bit like AI chat bots. Perhaps webmasters are investing in them to keep post count averages up

He means, I suggest, that the 'virus' are people of non-white skin colour. Which makes him a bit of horrible racist, if that was what he was suggesting. If not, then I apologise for any percieved insult.
Eggs is real.

[Toad]

1 minute ago, Mark J said:

He means, I suggest, that the 'virus' are people of non-white skin colour. Which makes him a bit of horrible racist, if that was what he was suggesting. If not, then I apologise for any percieved insult.
Eggs is real.

That is how I took it too.

 

New low for arbtalk today.

[Richard 1234]

3 minutes ago, Toad said:

That is how I took it too.

 

New low for arbtalk today.

Could be he meant all of London and Birmingham being took out making him not racist just evil all round

[Mark J]

2 minutes ago, Toad said:

That is how I took it too.

 

New low for arbtalk today.

Yup, Pretty grim.