Crude prices in America\u2019s oil capital are getting dangerously close to zero.<\/p>\n\n\n\n
\n\tBuyers bidding for crude in Texas, the birthplace of the shale \nrevolution, are offering as little as $2 a barrel for some oil streams, a\n precipitous markdown from a month ago. <\/p>\n\n\n\n
\n\tThe slumping value of physical barrels is raising the possibility that \nTexas producers may soon have to pay customers to take crude off their \nhands.<\/p>\n\n\n\n
\n\tNegative prices have already hit more obscure corners of the American \noil market amid a bearish trifecta of collapsing demand, swelling \nsupplies and limited storage capacity. The first US grade to bid under \nzero was a small landlocked crude stream known as Wyoming Asphalt Sour, \nwhich went for negative 19 cents a barrel last month, Bloomberg \nreported.<\/p>\n\n\n\n
\n\tIn Texas, prices are heading in that direction. A subsidiary of Plains \nAll American Pipeline bid just $2 a barrel for South Texas Sour on \nFriday, while Enterprise Products Partners LP offered $4.12 for Upper \nTexas Gulf Coast crude this week.<\/p>\n\n\n\n
\n\tOffers could fall further if benchmark West Texas Intermediate crude \nfutures — which have lost three-quarters of their value this year — \ncontinue to tumble. WTI closed below $20 a barrel this week for the \nfirst time since 2002. <\/p>\n\n\n\n
\n\tThat bodes ill for producers locked into contracts with suppliers, as \nthe daily price they earn for their crude moves with the broader market.<\/p>\n\n\n\n
\n\tFast depleting storage is still a major issue against a backdrop of \nunprecedented demand destruction from the coronavirus pandemic, and \nthese could pressure prices below zero fast. <\/p>\n","protected":false},"excerpt":{"rendered":"
Crude prices in America\u2019s oil capital are getting dangerously close to zero. Buyers bidding for crude in Texas, the birthplace of the shale revolution, are offering as little as $2 a barrel for some oil streams, a precipitous markdown from a month ago. The slumping value of physical barrels is raising the possibility that Texas […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[2,8],"tags":[639,56,1099],"yoast_head":"\n