lol accounting and lol jouralism
Berkshire Hathaway’s operating income increases and they have to report a loss because its stock portfolio declined? Come on.
Oil is a liquid, so you would need a big storage tank and not a warehouse. Or a million steel barrels I guess, which would be enormously expensive.
Just need a few of these:
The obvious answer is to manufacture one million waterbeds, but fill them with oil instead of water.
I’ll be waiting over here for my Nobel prize.
Maybe it’s so obvious that it doesn’t require mentioning, or maybe it’s understood to be a joke… But I’m pretty sure there would be some kind of regulations involved with storing a million barrels of oil, in any format. And probably a bunch of costs that would go along with that, like insurance, etc.
Who knows though, if you get paid to take it maybe you could still make a profit?
You may be waiting a long time. But a Noble prize? Definitely attainable.
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All this joking about oil storage does bring up a few questions to my mind.
Let’s say I buy a futures contract for X barrels at Y delivery date? If I actually want the oil and I have a bunch of tanker trucks or whatever, is there somewhere I can go on Y date to pick it up? Is that specified in the contract somewhere? Is it different for every contract? How exactly does the delivery part work?
I think they’re substantially all for some random place in Oklahoma.
But even that doesn’t explain it. The oil trade is global. If someone in Japan needs some oil, they’re not going to Oklahoma to pick it up.
If you actually want oil, you call up your local oil salesperson and ask them to send an oil truck around to drop off some oil.
Sure but what actually happens if I inadvertently hold a contract to expiry and then decide I want to keep the oil? Looks like I’ve gotta go to OK to take delivery.
That’s why I’ve started Oil Dash! - peer to peer oil delivery.
Send me seed money.
An oil futures contract is different from a regular contract to buy oil. If you want oil, you just sign a contract that says “bring some oil to my house on Thursday and I’ll pay you $20.” You buy futures contracts if you want to hedge or speculate on the price of oil in a financial market.
You do not have to go to OK to take delivery, you can have it shipped to you in a pipeline. Which is how the vast majority of crude is shipped within the US. Railroads and barges are well behind. The reason the benchmark is in OK is that specific spot is a pipeline hub.
There are regulatory and practical hurdles to storing and transporting crude. Starting with its tendency to vent lethal amounts of hydrogen sulfide.
In addition, the WTI benchmark is only one of two main ones, the other is Brent, which is in the North Sea. There are a couple dozen smaller benchmarks scattered around the globe, plus @bobman0330’s point that there is even more granularity for specific types of oil delivered to specific users.
One of the reasons WTI crashed a few weeks ago is it’s not easy to move it to tankers to ship it from OK to Houston to load on a tanker. Some of those pipelines were built when the US was a huge importer and aren’t even capable of sending crude south. If you have someplace you can store the crude, you may find that the pipeline to your facility is booked solid. There was no equivalent crash for Brent.
I only take delivery of bespoke artisanal crude whose ad speaks to me on my Facebook feed - preferably as some kind of monthly subscription.
Delete. Your. Facebook.
They’re evil.
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Thank you for reminding me to check Facebook.
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Every time you post that I explain why it works for me and has some essential stuff I need (groups), and also that it’s by far the easiest way for me to stay in touch with family and old friends or acquaintances. Not everyone is the same.
They’re no more evil than the other tech bro companies out there. They’re doing a better job than twitter or google at calling out blatantly fake news these days. It’s really pissing the deplorables off.
Twitter barely even tries, and will only blocks blatantly fake and dangerous covid stuff. Youtube continues to be the most evil - letting a bunch of super dangerous cult leaders spread their dangerous propaganda completely unfettered. Also google’s ads are in bed with the GOP.
"We haven’t done anything because we don’t see anything that attractive to do. That could change very quickly or it may not change,” Buffett said when questioned by a shareholder during [Berkshire Hathaway’s annual shareholder meeting]
Makes me feel better about sitting half of my money on the sidelines.
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