The Global Oil Market Is Broken, Drowning in Crude Nobody Needs

The Global Oil Market Is Broken, Drowning in Crude Nobody Needs

Onshore tanks in many markets are full, forcing traders to store excess oil in idle supertankers.. In physical oil markets, barrels are already changing hands for less than $10, and in a few landlocked markets producers are paying consumers to take away their crude.. With demand running 20 million barrels a day below supply, the world won't have enough tanks to store the surplus in two or three months.. Traders could put 100 million barrels at sea, he estimated, but even that accounts for just a few days' oversupply.. "Demand destruction is unprecedented," said Ben Luckock, co-head of trading at Trafigura Group, the second-largest independent oil trader.. As the refining system withers, the crude oil market is suffering.. In one obscure corner of the American crude market, prices have already turned negative.. Brent, the North Sea grade that sets the price for about two-thirds of the world's oil, ended last week at $24.93 a barrel, well above the historic low of $9.55 a barrel in 1998.. Brazil's state oil company Petrobras has announced it will reduce output by 100,000 barrels a day this year because of the lack of demand..