Oil arbitrage

Discussion in 'Economics' started by Krent Birshner, Apr 20, 2020.

  1. a good sign as to the foresight of everyone .... you can't just put the economy on pause... the economic understanding of the masses is zero.. when your entire familys wealth is flushed down the toliet.. lifetimes of work
     
    #71     Apr 20, 2020
  2. Amun Ra

    Amun Ra

    -38 per gallon? Guess filling those swimming pools is looking like a good idea. A pool can hold about 400 barrels of oil. You get paid $15k to fill it up with oil.
     
    #72     Apr 20, 2020

  3. hahahahaa, i doubt they would let us do that legally with out some hazard protection agency showing up at the door, shit this is insane
     
    #73     Apr 20, 2020
  4. .sigma

    .sigma

    Can anyone explain how spot crude can go below $0?
     
    #74     Apr 20, 2020
  5. SunTrader

    SunTrader

    They are paying for someone to take what they can't find storage space for.

    But, the cure for low prices ... are low prices, is an old trading expression.

    The bottom is close although I doubt, other than a screaming short cover rally (or two), crude will go anywhere but sideways for a while.
     
    #75     Apr 20, 2020
    .sigma likes this.
  6. Amun Ra

    Amun Ra

    I can't even imagine having the balls to short oil BELOW zero. I'm sure there were a lot of margin calls on the longs though today forcing them to sell, but can you imagine shorting?
     
    #76     Apr 20, 2020
  7. SunTrader

    SunTrader

    Doubt many trades were shorts. See this:

    Why Today’s 300% Oil Price Crash Isn’t As Bad As It Seems
    https://oilprice.com/Energy/Energy-...-Oil-Price-Crash-Isnt-As-Bad-As-It-Looks.html

    ....

    Especially:

    "The United States Oil Fund LP (NYSEARCA: USO) - an ETF for crude - undeniably instigated the historic decline in May WTI futures’ today. The reason? Because the futures contract expires on Tuesday.

    Bloomberg sources suggest that as of last week, the USO held 25 percent of the outstanding shares of May 2020 WTI oil futures. But that contract will end tomorrow.

    Buyers of these contracts must either sell these contracts for oil now or take physical delivery of the oil at the end of May. Of course, an ETF like the USO who deals in paper barrels is not eager to take physical delivery of any amount of oil - even if they could find somewhere to store it.

    The result? They must dump their oil, and they must do it now, no matter what the price."

    .....
     
    #77     Apr 20, 2020
    .sigma likes this.
  8. Amun Ra

    Amun Ra

    Wouldn't the may contracts be shown under "pending" if they sold today though?

    http://www.uscfinvestments.com/holdings/uso
     
    #78     Apr 20, 2020
  9. maxinger

    maxinger

    yesterday those who trade with trend should be earning thousands of dollars even with just one lot.


    counter trend investor will find making money very challenging.
     
    #79     Apr 20, 2020
  10. SunTrader

    SunTrader

    My guess even though that says as of April 20th it is probably from yesterday's close. Not today's.
     
    #80     Apr 20, 2020