Oil arbitrage

The only arb that exists in oil belongs to the Saudis

I suggest you study more about the storage of oil, specifically the convenience yield.

The storage capacity of oil impacts the price of oil itself.
 
It’s just a measurement like mentioned before. If you take delivery, your providing the tankers. This is dumby version. @bone would probably know better.

CME would be kushings Oklahoma I believe, this stuff is all tied to pipelines. You don’t just go with a truck and pick up barrels. Second off I’d assume theirs some administrative costs to taking delivery.
 
Unbelievable

Oil near $13.00


ENERGY
Oil futures contract expiring Tuesday dives 20% as pandemic ravages demand, June contract falls 8%
PUBLISHED SUN, APR 19 202010:07 PM EDTUPDATED MOMENTS AGO
 
Krent Birshner said:
Hi folks.... I hope you are all well....

I have an idea here to run by you folks. I have been studying the energy market very closely (in fact I have read almost all the new articles on Motley Fool and Investopedia from this past week...). I’ve learned (as some of you May or maybe not know) Barrels of oil are only $15. But after some research I found that an actual empty barrel (wood or steel) is actually very expensive (perhaps more than $100 per barrel). Now anyone with “half a brain” knows where I’m going with this...

So here is my idea folks. We buy oil at $15 a barrel then we dispose of the oil (perhaps sell it for $10 to petroleum stations? This is where we have to “lose money to make money”) and then we sell the barrels for $100. Do folks not realize that the barrels that oil is in are actually more valuable than the oil itself?

let’s here all of your thoughts on this.... I’ve been trying to poke holes in this idea but let me know what you folks thinks.... thanks, Krent
More...
If you buying oil you should have a container (barrel, cistern, etc.). If you do not have it you will buy it, rent it, borrow it. Nothing is for free. Buy Starbacks coffe and exchange it for barrel of oil lol
 
maxinger said:
smart idea. but read this thread first :

Hin Leong Trading, oil trader from Singapore has filed for $4bn bankruptcy
Discussion in 'Wall St. News' started by Nighthawk, 34 minutes ago.


also there are lots of people buying it thinking it is dirt cheap. and it gets cheaper and cheaper.
definitely one day, price will go up.
More...
When airplanes, and ships, and cars start to move relatively soon oil price will come up.
Oil bottom price is around $10. Today is $13. Good point to start closely watching it.
I am wondering if airlines and cruise lines are buying cheap one. UPS, Fedex do.
 
Krent Birshner said:
Hi folks.... I hope you are all well....

I have an idea here to run by you folks. I have been studying the energy market very closely (in fact I have read almost all the new articles on Motley Fool and Investopedia from this past week...). I’ve learned (as some of you May or maybe not know) Barrels of oil are only $15. But after some research I found that an actual empty barrel (wood or steel) is actually very expensive (perhaps more than $100 per barrel). Now anyone with “half a brain” knows where I’m going with this...

So here is my idea folks. We buy oil at $15 a barrel then we dispose of the oil (perhaps sell it for $10 to petroleum stations? This is where we have to “lose money to make money”) and then we sell the barrels for $100. Do folks not realize that the barrels that oil is in are actually more valuable than the oil itself?

let’s here all of your thoughts on this.... I’ve been trying to poke holes in this idea but let me know what you folks thinks.... thanks, Krent
More...
I suggest do a bartel trade: buy the oil change it to Starbacks coffe
 
1957may10 said:
When airplanes, and ships, and cars start to move relatively soon oil price will come up.
Oil bottom price is around $10. Today is $13. Good point to start closely watching it.
I am wondering if airlines and cruise lines are buying cheap one. UPS, Fedex do.
More...

airline buying oil?
Those who attempt to buy cheap oil at this time will probably be fired.

WHY? airlines are struggling. revenue is virtually zero.
liquid cash is shrinking. when liquid cash reaches zero, company will close down.
airlines are begging govt and banks for loan just to float.
 
Saudi Arabia recently bought 8% CCL stocks share, company may have money to buy a cheap oil.
One of the factor to compete, they will survive and this is good opportunity.
UPS is always buying futures, they have their own oil refineries.
 
S2007S said:
Unbelievable

Oil near $13.00
More...

This price (as a measure of oil cheapness) is misleading, most of the drop is happening on this current futures which expires tomorrow. New futures trade 22+ usd so technically the current/next spread is just skyrocketing. Safe to say there are/were huge longs with the need to get out or rollover so the market simply gives them that undesired exit price.

So today you say that oil is 13 but tomorrow you'll be saying that oil is 22 :)
 
tsfx said:
This price (as a measure of oil cheapness) is misleading, most of the drop is happening on this current futures which expires tomorrow. New futures trade 22+ usd so technically the current/next spread is just skyrocketing. Safe to say there are/were huge longs with the need to get out or rollover so the market simply gives them that undesired exit price.

So today you say that oil is 13 but tomorrow you'll be saying that oil is 22 :)
More...


Have you seen this happen this drastically before ? And is it always the front month dropping more than back month or is this very unique because its storage problem ?
 
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