Inventories at Cushing are just over 80% of capacity
The supply glut reasons are familiar from earlier in the year, mainly surrounding demend destruction due to lockdown measures, although, at this stage a return to negative prices appears unlikely.
Wood Mackenzie:
- Refineries are coming back online ... “Even as those facilities come back online, we are seeing excess inflows into Cushing overshadowing increased demand”
Adds Bloomberg:
- The structure of oil’s so-called futures curve has also motivated traders to store barrels. WTI has been in contango, when nearer-dated contracts are at a discount to later-dated ones. That means that, if the gap is wide enough, traders can make a profit by storing crude to sell it at a higher price later, when the glut eases.
