Fears of running out of storage capacity drove oil prices down over $40 in single day, forcing sellers to pay their buyers to take the product, and these fears were not unfounded. Yesterday the EIA released the latest weekly installment of its authoritative data on liquid volumes stored in the United States, and the data paints an urgent picture. Only about 3% of the stored oil volumes have historically resided on production leases while roughly half sits upstream of refineries. Since refineries can make storage space for crude by processing it and storing it as products, the system can hold about as much more oil as refined products waiting for shipment. It is safe to assume that storage capacity is no less than its recent high, but it is not clear how much more space may exist. When social distancing locked down the US, stocks of crude were already […]