long may crude contract from negative $40...taking delivery tomorrow

ironnchef's picture
Rank: Neanderthal | 2,666

so, i'm long crude oil from -$40

i'll get paid $40,000 per contract to take delivery...
30 contracts = $1.2 million
1000 barrels per contract = 30,000 barrels
42 gallons per barel = 1.26 million gallons

but i don't have a tanker truck fleet or barge to accept it.
can i just pour the oil into a ditch in the ground...or into the ocean?

serious questions

Comments (19)

Apr 20, 2020

I imagine the lawsuits will cost you significantly more than $1.2mm

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Apr 20, 2020

pull a BP and dump it in the Gulf of Mexico lol

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Apr 20, 2020

How can this be a serious topic?

Apr 20, 2020

never mind...i just covered at $16
made $24 * $1000 per contract (24k) * 30 = $720k

crazy fucking times woo hoo

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Apr 21, 2020

..

Apr 21, 2020

for your firm or for yourself?

Array

Apr 22, 2020

long soy beans

But who's to say what's fair to say and what not to say? Let's ask Dr. Dre
Apr 20, 2020

AMA pls

What concert costs 45 cents? 50 Cent feat. Nickelback.

Apr 20, 2020

i made some calls trying to rent tanker trucks for the oil...but not only were there none available..but i was told i wouldn't be able to get the insurance needed to fill the tankers with crude oil...so i just closed my position at a profit. lucky perhaps

Apr 20, 2020

I saw this when you first posted it and thought it was a joke but if it wasnt was wondering what the hell you were gonna do with all the barrels lol. Glad to see it worked out for you after all.

  • Incoming Analyst in IB - Gen
Apr 21, 2020

This is legendary. Please tell me this is real if so you need to write up a post describing this!

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Apr 21, 2020

dumb

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  • Prospect in S&T - Other
Apr 21, 2020

Unrelated question: is storage at point of delivery the responsibility of the buyer or seller of the contract? So if I hold the short but my buyer is out of storage, what happens? Am I also in trouble?

  • Analyst 1 in IB - Ind
Apr 22, 2020

I was wonder this too and i looked it up. it's the buyers responsibility.

Apr 26, 2020

Yeah so lack of the ability to store means lack of a buyer means lack of demand and higher supply and lower price.

"If you always put limits on everything you do, physical or anything else, it will spread into your work and into your life. There are no limits. There are only plateaus, and you must not stay there, you must go beyond them." - Bruce Lee

Apr 26, 2020
Prospect in S&T - Other:

Unrelated question: is storage at point of delivery the responsibility of the buyer or seller of the contract? So if I hold the short but my buyer is out of storage, what happens? Am I also in trouble?

This would never happen. The day before settlement they contact both parties to make sure you're both actually good for delivery and receipt. Assuming you don't lie at that point to the exchange...

Apr 25, 2020

this is amazing. should be framed

Apr 26, 2020

[the US Coast Guard would like to know your location]

Apr 26, 2020
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