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Oil is now at $13.32 (NOW $4.00) [Not anymore, now it's $1] {We're in Negative Land now}

Lonestar

Lonestar

Roll Tahd, Pawl
Moderator
Oct 25, 2017
3,558
John Dunbar said:
so what, they're giving it away? how does that work?
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Transistor

Transistor

Vodka martini, dirty, with Tito's please
Administrator
Oct 25, 2017
37,127
Washington, D.C.
Razgriz417 said:
www.macrotrends.net

Crude Oil Prices Today - Live Chart

Live interactive chart of West Texas Intermediate (WTI or NYMEX) crude oil prices per barrel.
www.macrotrends.net www.macrotrends.net
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How accurate is that versus this:

www.marketwatch.com

CL.1 | Crude Oil WTI (NYM $/bbl) Front Month Overview | MarketWatch

CL.1 | A complete Crude Oil WTI (NYM $/bbl) Front Month futures overview by MarketWatch. View the futures and commodity market news, futures pricing and futures trading.
www.marketwatch.com www.marketwatch.com
 
RedMercury

RedMercury

Blue Venus
Member
Dec 24, 2017
17,650
I just got 200 gallons of heating oil for less than 250 bucks, that never happens!
 
Last edited:
JohnsonUT

JohnsonUT

Member
Oct 27, 2017
2,032
sonder said:
Taken from: https://seekingalpha.com/article/4338551-why-wti-crude-is-crashing-much-today

The Simple Explanation
First, we need to consider what's actually being traded here. On one side, the crashing contract is traded on NYMEX under the ticker CL. Now consider the following regarding this contract:
  • This contract stops trading on the 21st of April (tomorrow).
  • This contract is settled physically.
This second item is critical. It means whoever is long the contract when it stops trading will have to take delivery of physical crude. This excludes any speculators not having somehow contracted for storage for this incoming crude. In practice, this excludes all people not professionally trading this thing at the same time as they contract physical infrastructure, including the very large ETFs which now dominate this market.

Now consider what the Brent contract traded on ICE actually represents:
  • The front-month is the June contract. It stops trading on April 30, so very comparable to the WTIC May 2020 contract.
  • This contract is settled in cash.
What that second item means is that any speculator can take this contract through the end of trading and subsequent expiration. Nobody is going to find barrels of oil with nowhere to store, if he does that.

Hence, for the WTIC front-month contract, you have extreme forced selling pressure from all the traders holding the contract which can't possibly go beyond tomorrow holding it. For the Brent contract, you have no such pressure. You also don't have such a thing for the June WTIC contract yet, simply because it doesn't stop trading for another month.

The end result is what you see.

On the buying side of the WTIC May contract, and except for those who were short the contract and can't possibly deliver crude either, you have only those who can take oil into storage. That's actually a potentially very profitable trade – to just buy this discounted oil, store it for one month, and then deliver it to the June CL buyers. However, there is a very limited public who can take advantage of this.

Conclusion
The extreme selling you're seeing in the front-month crude contract today, which will make the news everywhere today, is driven by this simple mechanism. There is extreme forced selling in this front-month contract because any speculators that can't take physical delivery have to sell these contracts today, no matter what.

This isn't happening in Brent simply because Brent crude contracts settle in cash. Thus, any speculator can take them to their expiry without being forced to sell at any price, a "luxury" not available in WTIC crude futures.
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Thanks for this. Seems like the underlying problems are still there and June will likely see similar scenarios.
 
Lump

Lump

One Winged Slayer
Member
Oct 25, 2017
15,980
Gamestop will give me more for a copy of Madden 14 right now
 
maabus1999

maabus1999

Member
Oct 26, 2017
8,904
Funny oil companies use to pay parts of their taxes via oil shipments to the national reserve. Honestly might be the only way to save your oil now on that contract is to pay the US Government to take your oil to the strategic reserve.

I will actually be curious if anyone is still left with a contract they couldn't liquidate and can't take delivery. Lawsuits coming...

BWoog said:
So if I buy oil futures now, it would be impossible for me to lose money?
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No. You can loose money indefinitely in theory with futures.
 
Xando

Xando

Member
Oct 28, 2017
27,292
If bush had known there is a way to get free oil maybe he wouldn't have invaded iraq
 
Lonestar

Lonestar

Roll Tahd, Pawl
Moderator
Oct 25, 2017
3,558
would have thought they'd suspend it when it devalued by 50%, not at "All Value is lost."
 
Orb

Orb

Banned
Oct 27, 2017
9,465
USA
this is probably an incredibly stupid question, and kind of pointless since I'm not actually going to do it, but if I wanted to just buy a barrel of crude oil, could I?
 
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