As recession saps demand, a world awash in oil

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Source: AP

NEW YORK – Supertankers that once raced around the world to satisfy an unquenchable thirst for oil are now parked offshore, fully loaded, anchors down, their crews killing time. In the United States, vast storage farms for oil are almost out of room.

As demand for crude has plummeted, the world suddenly finds itself awash in oil that has nowhere to go.

It's been less than a year since oil prices hit record highs. But now producers and traders are struggling with the new reality: The world wants less oil, not more. And turning off the spigot is about as easy as turning around one of those tankers.

So oil companies and investors are stashing crude, waiting for demand to rise and the bear market to end so they can turn a profit later.

Meanwhile, oil-producing countries such as Iran have pumped millions of barrels of their own crude into idle tankers, effectively taking crude off the market to halt declining prices that are devastating their economies.

Traders have always played a game of store and sell, bringing oil to market when it can fetch the best price. They say this time is different because of how fast the bottom fell out of the oil market.

Read more: http://news.yahoo.com/s/ap/20090303/ap_on_bi_ge/awash_in_oil

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I must have been sleeping.

Since when did this become a problem?

Wow.

p.s.: and the obvious question is, why am I paying $1.85/gallon at the pump then? Is it all stored in ExxonMobil's swimming pool?

[Why Syzygy]

1. What I'm wondering is

how did this happen? I'm not using less energy. Who is?

[depakid]

2. Would have been a good time to expand the strategic petroleum reserve

but apparently Congress didn't think so....

[RantinRavin]

3. The will wait until oil is over 100/barrel again

Then they will think about it.

[Strelnikov_]

5. Agree

A nation that consumes 30% of the worlds petroleum export market needs to stock up while the sellers are still willing to loan them the money with which to buy.

[RC]

4. Why is the price of gasoline going back up again?

[ThomWV]

6. Here's the excuse: There is too much high quality crude clogging up the system

Yep, that's the reason they are giving. All the refinery storage space is tied up with high quality crude, so there's no room for the lesser shit they use to make gasoline, leaving a shortage of the precious juice. That and, we are told, existing pipelines that took care of the demand of 2007~8 (remember $4+ gas at the pumps) quite nicely are no incapable of moving fuel to market fast enough.

Excuse me while I go blow myself - having tired of all these public blow jobs I've been subject to.

[taterguy]

7. Same reason a dog licks his balls

Because it can

[ConcernedCanuk]

8. Sort of a backward thing now, we are paying for STORAGE

.
.
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and it's in a MULTI-million dollar tanker that has to pay the crew to keep the ship afloat/running

and of coarse all the payments on the tankers cuz most of them are bought on credit . . .

so we are doing a mini-bailout at our gas pumps and our heating fuel tanks

RAPED AGAIN!