Comment by foota
5 years ago
Anyone got a spare oil tanker? :-) I only slightly kid, makes me wonder how quickly I could acquire a number of oil storage units.
edit: this tanker is off the gulf coast right now... https://horizonship.com/ship/274m-suezmax-crude-oil-carrier-...
Actually, I think the real players have already been doing this for a few weeks. If there's a buck to be made, you can bet someone is on it.
I was wondering whether they couldn't rapidly build some new storage (cost-effectively), but probably the answer is no.
I'm not sure there's much of anything that will get the NIMBYs riled up more than a million barrels of crude.
Add blue collar people to the mix and it acts like a NIMBY rage multiplier. I'm picturing the movie plot now:
A bunch of gulf coast fisherman, effectively unemployed by Corona hatch a plan to make a buck by taking advantage of the negative price of oil futures. They pool their resources and somehow get their hands on a derelict Venezuelan tanker, cheap because of favorable exchange rates, in order to take delivery of some obscene amount of crude as part of a scheme to make money on futures. Being on a budget of course they crew the thing themselves, it's a ship after all, just a little bigger than the ones they usually handle. Things don't exactly go as planned when they travel to Venezuela to take possession of the ship. Their journey from there to the Port of Houston to pick up their cargo is mired by an incompetent coast guard, environmental activists and a vengeful ex-wife turned local politician.
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Who does want a million barrels of crude in their back yard? As a very rough estimate, you'd have to stack them the better part of a mile high in mine.
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That's one of the reasons why spot prices are crashing: we've used up the supply of spare oil tankers to store the oil we're not using.
Just with a cursory "oil tanker for sale" search, they appear to be for sale in the $10-20MM range.
Just make sure they don't sell it to you already filled with "thank you" oil...
I mean... Free oil is still free oil, and worth something in the future. Just not as much as being paid to take oil :)
If the oil tanker can hold 2,000,000 barrels at -$35/ barrel you are being paid $70 million to store the oil for a few months...
Of course, the next question is who pays for transport to/from the tanker, labor, dock fees, employees in ship (unless you can simply "park" it for a fee)
Yeah, I was wondering. I think if someone had the experience needed to put this together quickly it would likely be profitable.
It looks like most tankers are ~200,000 metric tons which at ~8 barrels per metric ton is roughly 1.6 million barrels. You also really only need to store it for a month, I think June futures are around $20 still, and so it's a diff of ~$60/barrel.
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