Price of oil goes *negative*. How does this even make sense??

[KidCharlemagne]

@Chronos

This might be the worst thing ever for some nations like Saudi Arabia, whose economies are based primarily on oil. But while the US might be a slight net exporter of oil, our economy is a lot more diverse than that.

Velocity, last time I was out, I was already seeing gas as low as 97 cents, at the cheaper stations. So 90 cents hardly seems out of the question.

Unfortunately the largest issuers of junk and near junk debt are energy companies, and the majority of those issuances finance shale production which is the highest cost crude to produce. The good news is that it’s easy to shut down shale production (versus wells) but a price below $25/bb is gonna create a massive wave of defaults imminently. Then come the second order effects…

Regarding your previous post about tankers - there are currently about three dozen VLCC ships on the coast of California filled with crude and nowhere to unload. Tanker rates are currently about 9 times what they were about a month ago because there is a hugely profitable risk free trade if you have the space. You fill your VLCC with its 2mm barrel capacity at spot prices and sell the one or two month forward future at 10-15 dollars higher and you have a guaranteed 20-30mm dollar profit over a month or so. I know of one tanker lessor who was getting $400k a day for his crappy old ship at one point. They were about $18k a day a couple years ago.

[RTFirefly]

@KidCharlemagne

Tanker rates are currently about 9 times what they were about a month ago because there is a hugely profitable risk free trade if you have the space. You fill your VLCC with its 2mm barrel capacity at spot prices and sell the one or two month forward future at 10-15 dollars higher and you have a guaranteed 20-30mm dollar profit over a month or so. I know of one tanker lessor who was getting $400k a day for his crappy old ship at one point. They were about $18k a day a couple years ago.

“Why, I know a fellow who started only last year with just a canoe, and now he’s got more women than you can shake a stick at, if that’s you’re idea of a good time.”

[RioRico]

@RTFirefly

“Why, I know a fellow who started only last year with just a canoe, and now he’s got more women than you can shake a stick at, if that’s you’re idea of a good time.”

A fleet of Coleman canoes (sealed fibreglas, damn near immortal) could have a guy sitting pretty. The trick is hauling them upstream against riparian predators. Russian River freshwater sharks are a real hazard on the Ukiah run to supply cannabis factories.

Are hot-air balloons (after cooling) suitable for inflatable storage? Or are swimming pools better? Think of the towns and schools with closed pools - they’re sitting on a FORTUNE!

[Spectre_of_Pithecanthropus]

@Trom

More importantly, how are FCOJ futures?

Holding up very well!

I’m surprised. Nowadays when you go to the market, the frozen juice section is so small you’ll miss it if you blink. When I was a kid, there used to be like half an aisle of various frozen juices–mostly orange but also a number of other kinds.

[Spectre_of_Pithecanthropus]

@Chronos

This might be the worst thing ever for some nations like Saudi Arabia, whose economies are based primarily on oil. But while the US might be a slight net exporter of oil, our economy is a lot more diverse than that.

While the economy is diverse overall, the regions/cities that are heavily dependent on the oil industry will likely be hit hard.

[Telemark]

@Spectre_of_Pithecanthropus

I’m surprised. Nowadays when you go to the market, the frozen juice section is so small you’ll miss it if you blink.

Nobody Gives a Damn About Frozen Orange Juice Anymore

Your impressions are correct; the market for frozen OJ is anemic and getting worse. The price alone doesn’t reflect the state of the commodity market.