New nav hazard: Parked tankers?

This from the Toronto Star today. It looks like a few commodity speculators are chartering VLCCs for a few months, loading the tanks to the brim, and paying the crew to sit at sea and watch movies for a few months until the oil prices pick up again. This isn't exactly a new strategy, but it seems there are a lot more speculators trying to pull it off this time:

 

Why are they "speculators" ? Shell is buying oil because its being sold cheaper than they can produce it in some regions... this is a fire sale driven by credit issues... its not the real cost of oil. Buying and storing it is merely prudent at these levels!

 

If somebody told me he had doen that, I would knock him off his barstool and I tell ya what, Jack, they would have to hit me with a fire extinguisher to the head to get me to stop. Anybody who can afford to do that does not need to **** the rest of us just so he can get richer.

Pardon my French, but *******.

 

It is a simple matter of mathematics and opportunity - the oil from the well-head was UNDERPRICED and the futures contracts just in time for delivery were VERY attractive so pre-sell to the future and charter the mobile fuel supply and buy on spot.... - deliver for a guaranteed profit - If you had the readies, I am sure you would do exactly the same - the wanking speculators just set up the opportunity by going the wrong way with paper and computer screens in their glass & plastic towers of fantasy.....

 

I think you need to think about what is happening here again.

 

Nah. In a circumstance like that, if ya think about it, you'll never throw that first punch. Sometimes it's important to operate on instinct.

They are hoarding a commodity every bit as valuable and necessary as wheat.

 

Hoarding.... no really you don't get it do you?

 

Put all the fancy names on it you want; rationalize that "they're just out to make money," and I still won't budge an inch. These people are tying up the supply of badly-needed oil by parking ships?!?!? That means that while the vessel is sitting idle, it's effectively out of service. It can't drop its cargo and haul more oil

So *******s profit and the rest of us suffer. I don't care if it's strictly speaking "Legal," It's immoral as hell and I stand by my words.

 

Some people are perfectly *OK* when market forces drive prices downward, even below profitability, as happened for quite a few years during the 80's all the way to 2004-about 15 years total. But if market forces drive prices up, these SAME PEOPLE get angry and full of self-righteous indignation, labeling the oil companies/speculators/traders etc as 'immoral'. The hypocrisy of this stance seems to elude them, as is based solely on a very ugly human emotion; JEALOUSY

In the end, if some choose to 'hoard' oil awaiting the next price peak, such 'hoarding' will be on the whole beneficial, since more oil will be made available during the price peak period than would be available if the oil were not stockpiled. Furthermore, the price 'trough' is the result of among other things, falling demand. Yet this falling demand is itself somewhat mitigated by the stockpiling, which creates a demand for the commodity which might not otherwise exist during the 'trough' period.

In the end, stockpiling tends to help stabilize, rather than inflate the commodity price.

Jimbo

 

I think you really need to read a little more and educate yourself.

 

MB,

You've posted four times in this thread, once to describe the stockpiling of oil as a prudent move, and three times to tell Eponodyne that he doesn't get it and needs to read more.

Given the current situation on the commodity futures markets, I agree with you that stockpiling oil for use later in the year would seem to make financial sense, if you're in that buisness. (That doesn't mean that I trust Wall Street speculators to do the stockpiling.) But I think that if you are going to espouse this view so vehemently, then in the spirit of open discussion you ought to elaborate on what factors led you to this conclusion. Accusing other forum members of "not getting it" is not an appropriate way to begin a discussion.

 

Prolly something similar to my answer in #4.... The markets are behaving in a manner that can only be defined as "nuckin futs" and if you can see a profit (OPPORTUNITY) that can have the risk removed by using some of the herd's silly positions then do it, and then the herd heard and followed and may be too late and get caught on the wrong side of speculation again (GREED) - - - when the market has gone all illogical then careful observation identifies good deals and the "wall street herd" follow - but often not quick enough to profit from the gossip..... by the time they have accessed the money/credit to do the deal - don't shoot the cart if the horse rears up....

 

I'm past yelling about it now... it will become evident enough to the great unwashed soon enough.

 

Every price is determined at the intersection of two markets. The market for the good and the market for the money used to price the good. We have a dislocation in the later that is disrupting the former... all in all this is damaging many markets with good fundamentals. This is a "money market" or credit event, it will wash out... this also is a great example of why money needs to be stable and not the constantly inflating toilet paper that the great unwashed have been educated to trust. The market players are merely reacting to the fundamentals of the oil markets as they see them... speculators buy futures with no intent to deliver or supply... oil men fill ships full of oil and shut down rigs because the paper price has fallen below their costs, they do it to survive... and its kinda good for us that they do survive for tomorrow we need oil as well. Anyway... $3x oil has ensured $3xx oil will be here much sooner than it would have been otherwise, thats the great pity. Meanwhile the ignorant, bar brawling, energy entitled masses bay for the blood of the people that supply this much needed commodity, kinda like a teenager abusing the parents that feed and shelter them. We have a Magpie here that rears young every year... once they get to that stage the father beats the crap out of the kids and sends them off into the real world with his beak firmly poking their butts. The masses are about to feel the beak...

 

Now back to trite one liners for mass consumption...