Black Gold Bloodbath - WTI Crude Crashes To $45 Handle, 9-Month Lows

Tyler Durden's picture

"Someone's liquidating" warns one veteran energy trader as the sudden heavy volume surge to the downside in WTI crude futures smashes oil prices back to the lowest since August 2016.

Surging US crude production (once again to August 2015 highs)...

 

And demand forecasts are tumbling:

 

And loss of faith from the hedge fund community..

and this is what OPEC gets...

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FreeShitter's picture

all this good news today is keeping the pecker hard for sure.

Looney's picture

 

Before the Deal, OPEC should’ve hired the bald guy from the “Deal or No Deal” show.  ;-)

Looney

_RRR_'s picture

thx just sold me puts, Bloodbath news is what I'm looking for

VD's picture

anything above 25 handle is egregious scamola; at 24 and under there is real recoupling...

Philo Beddoe's picture

Deflation bitches. Except for paper assets of course. And houses....and Bitcoin. But, the rest of the shit...all bad. 

Quantum Bunk's picture

No not deflation. Not in dollar terms anyway. The USD is down right now and has been down with all risk assets since Aug 2016

 

King Euro bitches

Al Huxley's picture

USD - down, JPY - down, gold - down, copper - down.  What's wrong with this picture?  What is 'UP'?

Al Huxley's picture

No where NEAR enough liquidity to account for the imbalance.  Where is the money going?

readyforit's picture

I'm filling my tank with Bitcoin now bitches!

_RRR_'s picture

why not count your bitchcoins during the next power outage? Much more fun, I guarantee it

AE911Truth's picture

What power outage?
The cost of electricity is going down by 95%.
http://www.brilliantlightpower.com/

The kicker is: demand for these new cheap electricity generators will drive the price of silver past one thousand dollars per ounce, since they need one ton of silver per gigawatt, and the world uses twelve thousand gigawatts today. How much more energy will we consume after the price drops by ninety-five percent?

Thomas W. Swift's picture

Hmm, I haven't heard of these guys before.  I thought I had investigated pretty much all the known exotic energy technologies and I haven't run across this one before.  Just at a glance it looks highly doubtful to me.  Where is the huge amount of waste heat going to go?  Also, "dark matter"?  Please, these guys wouldn't know real physics if it jumped up and bit them on the ass.  Color me skeptical, but I've tried to investigate numerous technologies with an open mind.  The good news is that some of them are actually for real, and your premise about the cost of electricity is correct.  I just don't think this is the way it's going happen.

tuetenueggel's picture

come along and I´ll fill your Tank with completely free piss.

Cardinal Fang's picture

1970 Eldorado baby, 500 cubic inch motor, 400hp stock.

Fill 'er up with premium.

Ricki13th's picture

Thank you I can get cheap gas instead of the OPEC criminals robbing me at the gas pump.

Wipewithpaper's picture

68 Nova SS 440" Dart SB, engine dyno was 623HP and 600TQ 5 spd Vintage Air, disk brakes all round, PREMIUM fuel and gets 26MPG HWY, but only 8 MPG city beating up Corvette supercharged, or Vipers. Never been beat on the street.

vealparm's picture

In my garage:

1967 Pontiac Catalina Venture Coupe

2010 Caddy DTS

2015 Chrysler 300 Hemi

I love gas. Fuck electric cars.

buzzsaw99's picture

someone is liquidating...

gartman you magnificent bastard. kek

Expat's picture

I bet it's Andurand dumping.

mily's picture

Thank you very much hedgefund-idiots for taking the other side of our hedging trade

Yours sincerely,

OPEC

bladrnr_2019's picture

I thought cheap gas was a good thing.

 

That's why I bought my Frontier crew cab. Cheaper than premium in my old Jetta.

man from glad's picture

Maybe crude is falling but the gas pump prices are not. (at least where I am)

tuetenueggel's picture

That´s a so called windfall profit !!

vealparm's picture

This.

When crude was $147, gas was $4.25

Now crude is $45-50 and gas is $2.45.

Something is smelly in Denmark. Gas should be $1.50.

2_legs_bahhhhhd's picture

Here gas prices are the same when oil was over 100$/brl...thank you turdoh... global carbon tax will save us all

sinbad2's picture

The low oil price means that the major oil companies are losing money on every barrel of oil they pump from offshore rigs. Someone has to make up the loss, I guess that someone is you.

CNONC's picture

Weren't those peak oil guys showing me that same US production chart six months ago as proof of permanently collapsing Shale oil?

toocrazy2yoo's picture

Oil will be obsolete when there's a replacement for it. Picture tube CRTs are obsolete, not oil as energy.

Turdy Brown's picture

I'm a little confused here, and maybe some very smart people here at ZH can halp a brotha out:

So a few years back when crude was selling for approx. $150/bbl and I was paying +$5/gal (gas and diesel) for my employees to drive around town (I am a contractor), who exactly was pocketing this premium? 

toocrazy2yoo's picture

It costs between 1.70 or 1.80 to get the crude refined and into the pipeline and transported to your gas station. That pays the pipeline, the hauling, the refining, additives and a couple of cents to your local dealer for profit AND local taxes. Everything else represents the cost of crude above roughly 30 or 35 a barrel, WTI. I base that on my experience buying gasoline starting when gasoline had dropped to 1.80 at crude prices around $40/bbl. Crude kept dropping, but gasoline held around 1.80. Local sales and State taxes are another variation, but those are locally steady. Hell, home heating oil is still selling at 1.70/gallon on contracts even with crude at 55. There is a baseline expense from the refiner to the pump that have to be paid no matter what the price of crude. The extra above that is inflation of pump price owing to higher-priced crude. The market for unleaded gasoline is always in flux owing to "storms", "maintenance" at the refineries, "changeover expenses" from winter to summer (even in Florida) and other factors. All it takes is for a pipeline in Virginia to get hit by a shovel and gasoline will spike a buck a gallon at the pump clear to N.J. for two months. Finished refined product such as motor oils, heavy lubes and asphalt follow the same rough path to pricing. With longer oil change intervals, more efficient heating systems and the rest, they simply aren't selling as much of the stuff, per capita.

We're not going to see $1.25 gasoline again, but hell, adjusted for inflation, at 2.00/gallonUS, it's probably about the same as gasoline at .29 cents back in the mid-sixites. Less, even. It's a grand time for gasoline these days and these prices are what they are because the cars simply are much more efficient, even with all the performance gains. We're so awash in gasoline we fill tanker with the stuff and send millions of barrels of it off to Europe, China and Japan.

shortonoil's picture

 

"Maybe crude is falling but the gas pump prices are not. (at least where I am)"

They won't until WTI hits at least $43. $43 is now the refineries raw material (crude) breakeven point.

http://thehillsgroup.thehillsgroup.info/p/040217refinery-yieldsthe-et-mo...

roadhazard's picture

I'm sure it can go down more. But then we will have Trumps gas tax and the State will want more...

venturen's picture

Faith...in the markets of today.....R U FN Kidding me?

toocrazy2yoo's picture

Me, I have faith in the Silver markets myself.