02-26-2015, 02:21 PM
Remember this when Oil is back over $100 and Gas back over $4
2-25-2015
Are oil producers running out of closet space?
Oil supply running ahead of demand hasn't just pressured prices, it's also filling up storage space
Around 50 million to 100 million barrels of crude oil may be gathering dust in floating storage by the end of the second quarter, compared with around 110 million barrels in April 2009, during the global financial crisis
As much as 80 percent of the commercially available storage in the U.S. may already be utilized
Others are also concerned about how quickly space could run out. "Within around two months, [onshore storage will] be completely exhausted," Ivan Szapakowski, a commodity strategist at Citigroup, told CNBC last week. "The only remaining storage globally will then be floating storage, tankers."
Oil is already getting stashed offshore. Tanker prices and lease rates have doubled over the past 18 months
"Clearly, someone is going out there and leasing a lot of offshore storage and those lease rates are much higher. That suggests to me that there's a massive supply of oil sitting on the ocean," Sodhi said, noting each tanker can hold around 1 million to 2 million barrels each. "That sort of storage is going to take a while to unwind."
2-25-2015
Are oil producers running out of closet space?
Oil supply running ahead of demand hasn't just pressured prices, it's also filling up storage space
Around 50 million to 100 million barrels of crude oil may be gathering dust in floating storage by the end of the second quarter, compared with around 110 million barrels in April 2009, during the global financial crisis
As much as 80 percent of the commercially available storage in the U.S. may already be utilized
Others are also concerned about how quickly space could run out. "Within around two months, [onshore storage will] be completely exhausted," Ivan Szapakowski, a commodity strategist at Citigroup, told CNBC last week. "The only remaining storage globally will then be floating storage, tankers."
Oil is already getting stashed offshore. Tanker prices and lease rates have doubled over the past 18 months
"Clearly, someone is going out there and leasing a lot of offshore storage and those lease rates are much higher. That suggests to me that there's a massive supply of oil sitting on the ocean," Sodhi said, noting each tanker can hold around 1 million to 2 million barrels each. "That sort of storage is going to take a while to unwind."