That time oil literally went below $0

How was this possible? Explain to a retard like me. Why didn't everyone load up if people were paying to give it away? Or was this offer only exclusive to jews?

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Valuable things get dumped the hardest

because we werent sure if teslas would replace gas vehicles and anyone would ever want it again

Because crude oil is difficult to store, there are regulations around storage, and it is corrosive/toxic. Where would you put it after buying it?

Cause everything is manipulated user

>Why didn't everyone load up if people were paying to give it away?
Storing shit takes money.
If I send you 10.000 cubic feet of water tomorrow, can you store it? Dumping it will also cost you money

It only went negative on one specific futures contract

Oil is a a commodity so people bought contracts for delivery but obviously didnt want to take delivery of oil. so they dumped the contracts that were close to the delivery date but as there was little demand cause of china virus nobody wanted the oil so prices plummeted even turning negative i.e paying other people to take delivery of the oil.

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This

They are traded via futures, which are contract stipulating that you HAVE to take delivery at expiration. Normally, the ETF just sells the contracts before expiration and buys new ones, but in March 2020, nobody was willing to buy the contracts for money, because nobody had the capacity to store the oil, as demand had dropped off a cliff. So you had to pay for people take it off you.

Makes sense, but it's hard to believe panic selling and liquidations were that extreme without people mass buying. It's not like oil became useless overnight.

Thanks

Future contracts. If firms downstream from you start shutting down with little warning you might not be able to accomodate the agreed physical delivery. You then pay someone to take it off your hands.

This. When lockdowns happened and nobody was driving, there wasn't enough new demand for all the oil that was just produced and there weren't enough facilities to store that much oil. So they had to pay people to take the extra oil.

but but bitcoin is too volatile and risky

>how is this possible
>what is a cartel
You still think we live in a fucking free market lol
There is no free market, only arrangements and deals between interested parties. The goal was and still is to move away from previous corrupt arrangement and create a much more organic, natural state of global economy. Before that, previous complications and hostile elements both foreign and domestic needs to be dealt with.
It was a pissing match between Saudis and Russians over somewhat temporary perception of betrayal, something that obviously got patched over as now they are working together to reap the rewards of increasing oil revenue.
Things are still in chaos.

Oil is traded on futures contracts. Futures contracts have a delivery point. So the contract is for 1000 barrels of oil delivered at a date to Cushing Oklahoma. The tank facilities in cushing was full or very near. The available space to store oil was very expensive. The price went negative in the amount it cost to store the barrels. Not every futures contract went negative. Just the April.

>oil is sold as a commodity
>futures on oils are sold
>people place bets on its price from the moment it's extracted to the moment it's sold for refination
>volatility between these two points creates profits
>Le coof quarantine arrives
>people don't go out
>people don't use gas
>there is excess surplus of oil
>people longing oil sell their futures
>oil futures collapse
>Le coof quarantine is extended
>oil surplus exceeds storage
>now even tankers don't have a place to storage oil
>having an oil future means you personally own the amount of barrels indicated in the instrument
>if you don't sell soon, you'll end up with several thousand barrels in your garage
>sell cheap
>no sale
>sale cheaper
>no sale
>give away
>nobody wants it
>I'll give you money, just take it

It was liquidations. Lack of demand alone can't cause oil to fall below 0 because it is so widely used not just in vehicles. It fell below zero because gamma on oil futures turned negative during a retarded panic race to the exits. The short term cost of settling long contracts became so high that the risk of holding them became massively inflated compared to normal risk conditions meaning people were willing to pay a fee even at $0 to get the risk of their book and avoid liquidations in other assets. People don't understand just how much leverage is out there since 2009-2012 and how interlinked it is.

This will happen with BTC. You will literally owe money for holding it, buy gold.

The offer was to anyone buying and storing oil so it’s not something would have been useful to the regular person unless they were shorting the contract derivatives market

So who ended up "buying" most of it? Oil is good for a few years, so unless people expected this to be the end of the world, they could have take the oil + $ and built additional storage.

If you got stuck with one of these contracts they wouldnt show up with 10,000 barrels of oil on your doorstep.
Yes, any one of you retards could have made free money by buying the oil dip.

>That time link literally went to $0

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Storage was probably full due to the economy shutting down.

You aren't liable for storage costs in any major volume oil contract. Someone else is, creating negative gamma. Your explanation is simplistic and retarded one plagiarized from a CNN article.