Getting Paid to Buy Oil
It’s hard to believe that the price of oil can dip into negative territory. But that’s just what happened on Monday the 20th of April. Since the beginning of the COVID19 outbreak, global oil consumption has fallen to an unprecedented level. Planes aren’t flying, cars aren’t driving, and consumers aren’t buying gas. All this being said, producers have continued to pump the black gold. As a consequence, the storage needed to collect the excess supply was running short. Some traders paid buyers to take oil off their hands and for a couple of moments the world saw negative prices on barrels of oil.
In practice, could I make a profit from the negative oil prices?
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Do you have knowledge in the laws and regulations for transporting and storing crude oil?
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Do you think an oil producer would pay you to take only one or two barrels? I doubt it. They deal hundreds of barrels at a time. Could you handle storing at this grade?
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Who would buy barrels of crude oil from a random person like you?
So in reality, NO, you won’t become the next Mukesh Ambani from this market surplus.
Amine