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Crude oil is now 60 cents a bbl


mikeman
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How does negative barrel work?  Anyone have a real explanation

"West Texas Intermediate crude oil futures for May delivery cratered by 305 percent to -$36.73 a barrel. "
 
That is a very specific product. It's not the price of the oil, per say, It is the price of a contract to take delivery of oil from a certain source at a certain time.
 
All the oil storage facilities that this grade can reach (it's landlocked, so tankers aren't an option) are full now, so the last thing anyone wants is to have a contract on their hands saying they will take delivery of something they have nowhere to put. When mid-may arrives, the people who are left holding these contracts with nowhere to put the oil will need to reneg on them, and end up paying penalties. Thus the "paying people to take the contracts off your hands" part.
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