US running out of room to store oil; price collapse next?

[BlueStateSaint]

Yeah, it's an AP story, but it's from Yahoo! News, so . . .

US running out of room to store oil; price collapse next?

By JONATHAN FAHEY     17 hours ago

NEW YORK (AP) — The U.S. has so much crude that it is running out of places to put it, and that could drive oil and gasoline prices even lower in the coming months.

For the past seven weeks, the United States has been producing and importing an average of 1 million more barrels of oil every day than it is consuming. That extra crude is flowing into storage tanks, especially at the country's main trading hub in Cushing, Oklahoma, pushing U.S. supplies to their highest point in at least 80 years, the Energy Department reported last week.

If this keeps up, storage tanks could approach their operational limits, known in the industry as "tank tops," by mid-April and send the price of crude — and probably gasoline, too — plummeting.

"The fact of the matter is we are running out of storage capacity in the U.S.," Ed Morse, head of commodities research at Citibank, said at a recent symposium at the Council on Foreign Relations in New York.

Morse has suggested oil could fall all the way to $20 a barrel from the current $50. At that rock-bottom price, oil companies, faced with mounting losses, would stop pumping oil until the glut eased. Gasoline prices would fall along with crude, though lower refinery production, because of seasonal factors and unexpected outages, could prevent a sharp decline.

Ya know, this could all be taken care of . . . if the greenies would allow new refineries to be built.

The rest of the story is here:  http://news.yahoo.com/us-running-room-store-oil-price-collapse-next-171025276--finance.html

[obumazombie]

Even the Bob Barker along with Paul Watson, the Sea Shepards and the anti whaling fleet needs to top off their tanks occasionally.

[thundley4]

Yet gas prices have jumped back up well over $2/gal and are expected to climb into the summer.  WTF?

Goodbye, Cheap Gas: Prices Continuing to Rise Mar 2, 2015 9:28am
The days of gas prices being lower than $2 are firmly in the US drivers’ rear-view mirrors.
The national average price for a gallon of gas is now $2.38 — 10 cents more than a week ago.
And GasBuddy expects those prices to keep climbing — seven cents to 10 cents — during the weekend. 

http://abcnews.go.com/blogs/headlines/2015/03/goodbye-cheap-gas-prices-continuing-to-rise/

California gas prices jump $1 in one month
California gas prices have shot up about $1 a gallon in the last month as oil refineries have been idled by a labor strike and an explosion.

That's made gasoline much more expensive here than anywhere else in the nation — an average of $3.44 for a gallon of regular as of 7 a.m. Wednesday, according to price-tracker GasBuddy.com. Hawaii is the only other state with an average price above $3 a gallon.

Drivers in Los Angeles are paying an average of $3.54 a gallon to fuel up, more than any of the other 443 metropolitan areas tracked by GasBuddy.

http://www.latimes.com/business/la-fi-gas-prices-20150304-story.html

[DLR Pyro]

California had schwartzneggers bullshit cap and trade tax kick in last month plus the refinery accident plus the annual excuse of switching from "winter blend" to 'summer blend' all contribute to the increase.

[thundley4]

California had schwartzneggers bullshit cap and trade tax kick in last month plus the refinery accident plus the annual excuse of switching from "winter blend" to 'summer blend' all contribute to the increase.

Plus the union strikes.

[JohnnyReb]

What we really need is a refinery that will process greasy democrats into a useful fuel source.....we'll worry about the pollution that causes later.

[J P Sousa]

This is from Oct 2014;

Why President Obama Should Refill the U.S. Strategic Petroleum Reserve   



Today, the U.S. (and global) oil supply faces significant threats that make it worthwhile to have as large a strategic oil reserve as possible. At the same time, oil prices have fallen to multiyear lows as supply growth has temporarily run ahead of demand.

Obama should take this opportunity to refill the Strategic Petroleum Reserve to its full capacity. The benefits to the United States' energy security far outweigh the potential costs.

http://www.fool.com/investing/general/2014/10/19/why-president-obama-should-refill-the-us-strategic.aspx

[DLR Pyro]

The question I have is with oil being so cheap, is the strategic reserve being refilled or is obama letting it languish?

[obumazombie]

The question I have is with oil being so cheap, is the strategic reserve being refilled or is obama letting it languish?

Whatever will hurt America and Americans worse.

[Lacarnut]

Yeah, it's an AP story, but it's from Yahoo! News, so . . .

Ya know, this could all be taken care of . . . if the greenies would allow new refineries to be built.

The rest of the story is here:  http://news.yahoo.com/us-running-room-store-oil-price-collapse-next-171025276--finance.html

The longs in the market are betting that the price is going up rather than declining. We will see.

 

[Retread]

Re: the  strategic reserve - the law states that the reserve must hold 90 days import equivalent at any time and if reduced, refilled within a year. Since our imports have been reduced by a very significant amount the reserve currently exceeds the required volume.

That said, it seems to me it would be prudent to add volume at the current and near future reduced price.

Therefore do not expect it to happen. When has the little o ever done what was prudent?