By Russell Gold, Benoit Faucon and Rebecca Elliott April 14, 2020 10:16 am ET No one expected 2020 would unleash a world-wide oil-production cut led by the U.S., Saudi Arabia and Russia. But since the new coronavirus hit, the world’s thirst for oil has vanished, creating an unprecedented crisis for one of the planet’s most powerful industries.
Over the weekend, a coalition of nearly two dozen of the world’s largest oil-producing countries agreed to withhold 9.7 million barrels a day from markets. It is unclear if this level of coordinated cuts is enough to erase the glut. Mohammed Barkindo, secretary-general of the Organization of the Petroleum Exporting Countries, has described the fundamentals in the oil market as “horrifying.”
Crude-oil demand has fallen in an unprecedented manner, sending the global oil industry into a tailspin.010060Sources: International Energy Agency ; Trafigura Behind it all is the decision by governments to order or urge citizens to stay home. Normally, about 60% of the world’s oil goes toward making transportation fuels. Now, traffic counters and satellite images show a world immobilized.
Earlier this year, Kevin Foxx’s four cylindrical tanks capable of holding a total 700,000 barrels of crude in the Cushing, Okla., area—the main pipeline-and-trading hub in North America—were less than half full. Now, the chief executive of Barcas Pipeline Ventures LLC said he expects them to be filled by this month’s end.
Colonial Pipeline Co., whose 5,500-mile conduit carries gasoline from Gulf Coast refineries into the Washington, D.C., and New York metro areas, issued a stern reminder in mid-March: Shippers couldn’t put gasoline into the nation’s largest fuel-conveyance system if they didn’t have contracted buyers. Operators like Colonial don’t want their pipelines to become parking lots for fuel.
Optimists such as energy economist Philip Verleger believe the industry will be able to regain its footing once virus-related lockdowns are lifted and people begin to move again.
They will get over it. As will we. The virus will disappear as suddenly as it appeared. And we will all say 'That could have been so much worse'
Hallelujah!
like no other in it's history? try looking back, to say, the 80's. or numerous other decades
41 years worth of oil currently being stored, and oil companies are still pumping out around 70-100million bpd.
With production cuts now finalized fully expect gas prices to go up immediately.
I hope world is not serious about epidemics. Pandemic is nothing..
Trump filled the reserves at rock bottom prices, and now the price is climbing due to production cuts. A win for America! KAG
Dumbest headline in History, how can supply be on high demand, as use hits all time LOW
Don't worry. Just tell what amount is soaring. Will collect
ponzi
Very strange times! It'll pick up again. Eventually!