The news is everywhere that Oil is now in Minus $ territory.

sadly Whether you are an oil worker or not, politician or not its not something to gloat on.


for clarity sake Its US crude Western Texas intermediate futures (WTI) that entered negative territory, I am nt an oil industry expert but oil has nt become completely useless as a few would wish for.


For the first time in the history of trading US crude, West Texas Intermediate, its benchmark, is trading in negative territory.
As of 8:22pm on Monday, US WTI was trading at $-37.45 per barrel according to prices displayed on Bloomberg energy terminal.
While this is not good news for oil-producing countries, here are a few questions to help you better understand the situation.

Q: What does trading in negative territory mean?

A: A simple way of explaining it is that traders will pay their customers for patronising them

Q: Is this a good thing?

A: No, it is not. Traders and oil exploring companies are running at a loss. It also means that there is no storage space to store excess production.

Q: Will this price be the same across the entire industry?

A: No, the negative price is only for US crude. Also, it only applies to May futures as the contract for June delivery is still at $22/barrel and July is at $27/barrel.

Q: Futures? What does that mean?

A: In the crude oil industry, refiners and other buyers can pay ahead for crude that would be delivered at a later date. Thus, some of the May futures would have been sold earlier in the year for as high as $50 or $60 if the customers negotiated or paid in January.

Q: So oil is not valueless yet?

A: No, it isn’t

Q: So how does this affect other producers?

A: This would serve as a warning for the Organisation of Petroleum Exporting Countries (OPEC) of how bad the demand problem has gotten.

Q: So what about the price of Nigeria’s crude oil?

A: Nigeria’s crude oil is benchmarked against the Brent crude. At present, the price of a barrel of Brent crude is $25. Although traders in the market said Nigeria’s Bonny Light was sold for between $13 and $15 recently, the price is not yet in negative territory.

Q: Will this blow over?

A: It is expected that the global economy will rebound gradually once coronavirus-induced lockdowns are lifted and activities resume.

mynd44, lalasticlala Fp

SadiqBabaSani:
The news is everywhere that Oil is now Minus territory.

sadly Whether you are an oil worker or not, politician or not its not something to gloat on.


for clarity sake Its US crude Western Texas intermediate futures (WTI) that entered negative territory, I am nt an oil industry expert but oil has nt become completely useless as a few would wish for.


For the first time in the history of trading US crude, West Texas Intermediate, its benchmark, is trading in negative territory.
As of 8:22pm on Monday, US WTI was trading at $-37.45 per barrel according to prices displayed on Bloomberg energy terminal.
While this is not good news for oil-producing countries, here are a few questions to help you better understand the situation.

Q: What does trading in negative territory mean?

A: A simple way of explaining it is that traders will pay their customers for patronising them

Q: Is this a good thing?

A: No, it is not. Traders and oil exploring companies are running at a loss. It also means that there is no storage space to store excess production.

Q: Will this price be the same across the entire industry?

A: No, the negative price is only for US crude. Also, it only applies to May futures as the contract for June delivery is still at $22/barrel and July is at $27/barrel.

Q: Futures? What does that mean?

A: In the crude oil industry, refiners and other buyers can pay ahead for crude that would be delivered at a later date. Thus, some of the May futures would have been sold earlier in the year for as high as $50 or $60 if the customers negotiated or paid in January.

Q: So oil is not valueless yet?

A: No, it isn’t

Q: So how does this affect other producers?

A: This would serve as a warning for the Organisation of Petroleum Exporting Countries (OPEC) of how bad the demand problem has gotten.

Q: So what about the price of Nigeria’s crude oil?

A: Nigeria’s crude oil is benchmarked against the Brent crude. At present, the price of a barrel of Brent crude is $25. Although traders in the market said Nigeria’s Bonny Light was sold for between $13 and $15 recently, the price is not yet in negative territory.

Q: Will this blow over?

A: It is expected that the global economy will rebound gradually once coronavirus-induced lockdowns are lifted and activities resume.

Good stuff! Rare around here.

It will bounce back once Economies are opened in about 3 weeks

Oil should just become useless, as useless as a scrap paper.
Oil is a curse to the common man, The Niger Deltans can't fish in their waters, The politician sees oil as a blood money venture, no work just fat salaries.
ND boys no wan work, they wait for amnesty money.
The country don't even want to look at other means to generate cash.

Good explanation... nice research

You have written well... I respect your analysis

i dont know why som people are rejoicing over oil price dip, everyone will feel it if oil test negative territory... one useless politician will further hide d little money in Public purse... dey will vomit everything

Correct

Lemme make this straight.
I'm a patriotic Nigerian who desires to see Nigeria Great again in my lifetime. We can surp up so many analysis to feel good.
Here is the Truth, the decline in price of crude oil have long been predicted plus the novel covid 19. What does this tells us? It tells us that the pandemic + the depreciation of crude oil have been a long time plan by some World Super Powers. For this reason, new form of energy [solar] have employed for the past decades.

Hoping & folding our arms for the price of crude oil to reappeciate will be a wait in frutility. It is a strategic & political move by the United States of America.
The collapsed value of crude oil will come with new realities of its own.
For Example:
Crude oil have been the source funding terrorism globally the funds for sponsoring.
The fall in the value of Crude oil marks the fall of terrorism globally.

I wish oil prices can remain low for ten years, Nigeria would be one of the greatest countries on this planet!!!


I AM DONE TALKING

Of course the price should continue to drop.maybe then we will have sense... I wonder what minister of labour and productivity and Agriculture is doing.

We should go to farm you see those useless civil servants that always seating and cross legs in office waiting for 30days to finish and get salary without doing anything.

Minister of labour and Agriculture should take a decisive action against this civil servants buddle them to farm so that they can be productive and work for what they are paying for every month.

Lipscomb:
Of course the price should continue to drop.maybe then we will have sense... I wonder what minister of labour and productivity and Agriculture is doing.

We should go to farm you see those useless civil servants that always seating and cross legs in office waiting for 30days to finish and get salary without doing anything.

Minister of labour and Agriculture should take a decisive action against this civil servants buddle them to farm so that they can be productive and work for what they are paying for every month.

if the way you re talking iss the way u wud advise a political leader den dre is big problem

d money misused ad stolen by politicians in Nigeria alone ia more than d wage bill of d federal ad state civil service respectively

Lazy civil servant spotted. We are talking about how to make civil servants productive in this economy meltdown you are talking of politicians that stealing money... There's no different btw the two.

SadiqBabaSani:
if the way you re talking iss the way u wud advise a political leader den dre is big problem

d money misused ad stolen by politicians in Nigeria alone ia more than d wage bill of d federal ad state civil service respectively

OPEN LETTER TO GODWIN EMEFIELE CBN GOVERNOR

GODWIN EMEFIELE THE BANE OF NIGERIAN ECONOMY

LET US GO INTO THE NITTY GRITTY OF THIS LETTER WITHOUT DILLY DALLY

THE NIGERIAN ECONOMY UNDER THE CURRENT CBN GOVT HAVE SUFFERED ABYSMALLY IN TERMS OF GROWTH, STANDARD OF LIVING AND COST OF LIVING ALL EMANATING FROM HIS SNOWBALL ABILITY TO INCESSANTLY DEVALUE THE NIGERIAN NAIRA.
I KNOW SOME ECONOMISTS WOULD ARGUE VAGUELY THAT HE DID IT UNDER THE DIRECTIVE OF PRESIDENT BUHARI BUT WE ALL KNOW THAT THE CBN IS AN AUTONOMOUS INSTITUTION AND THUS ACTS INDEPENDENTLY.

THIS HIS JAUNDICED INCLINATION TO DEVALUE OUR NAIRA AS SEEN IN HIM DEVALUING IT FROM (160 TO 360 AND NOW RECENTLY WHICH HE CALLS MUTIPLICATIVES FROM 360 TO 380 TO A DOLLAR) IS HIGHLY SICKENING AND UNPATRIOTIC.

UNPATRIOTIC IN THE SENSE THAT HE IS SUPPOSE TO PILOT THE AFFAIRS OF THE CBN WHILE PUTTING NIGERIAN INTEREST FIRST INSTEAD OF LISTENING AND IMPLEMENTING ANY IOTA OF DEVALUATION ADVICE BEEN SPOONFED HIM BY THE IMF, WORLD BANK ET AL.

I WOULD SAY HE JUST CAME IN AND SPOILT THE SUCCESSES OF HIS PREDECESSORS PROF. SOLUDO (WHO TRIED TO REVALUE/APPRECIATE OUR NAIRA BY RE-INTRODUCING COINS WHICH DIDN'T PULL THROUGH DUE TO ITS POOR GENERAL ACCEPTABILITY) AND SANUSI LAMIDO, FOR THEM DEVALUATION WAS NEVER AN OPTION, PLUS BECAUSE THEY KNOW WHEN YOU DEVALUE IT IS HARD TO REVALUE.

GOING FORWARD, HIS POLICIES HAVE GREATLY AFFECTED NIGERIANS BADLY IN THAT WHAT WE COULD GET IN THE MARKET AT LESSER IS NOW WORTH MORE THAN TWICE IT'S WORTH, THUS LOW STANDARD OF LIVING AND HIGH COST OF LIVING BECAUSE THE NAIRA HAS LOST IT'S VALUE AND CAN'T VIE INTERNATIONALLY.

FURTHERMORE, HIS UNSAVOURY REGULATION AND CONTROL OF FOREX IN PARTICULAR THE DOLLAR IS NOTHING TO WRITE HOME ABOUT, BECAUSE HE NOW PLAYS SECOND FIDEL TO THE BUREAU DE CHANGE.

YES THE INVISIBLE HAND OF DEMAND AND SUPPLY WOULD DRIVE THE PRICE OF THE DOLLAR BUT THE CBN STILL RETAINS NE PLUS ULTRA JURISDICTION IN ITS PRICING, REGULATION AND CONTROL. AND TO MY SHEER SURPRISE THE CBN IS PLAYING A SECOND FIDEL IN THIS ROLE, IN THAT, MORE PERCENTAGE OF THE DOLLAR IS ISSUED TO THE BUREAU DE CHANGE MAKING THEM HAVE MORE CONTROL OVER THE DOLLAR PRICING INSTEAD OF ISSUING MORE PERCENTAGES TO THE COMMERCIAL BANKS THAT CAN FOLLOW AND OBEY SPECIAL DIRECTIVES (UNLIKE THE BUREAU DE CHANGE) IN THEIR PRICING AND ALLOWING GREATER ALLOCATIONS FOR FORM Q SO THAT BUSINESSES CAN GET THEIR DOLLAR AND ITS PRICING FROM THE CBN THUS BOOSTING BUSINESSES AND THE ECONOMY AT LARGE. BECAUSE IF THIS IS DONE THE POSITIVE TRICKLE DOWN EFFECT WILL BE GREAT IN THAT IT WILL TRANSLATE INTO LOWER COST OF GOODS SOLD DOMESTICALLY, LOW COST OF LIVING, AND INCREASE IN THE STANDARD OF LIVING, AND MIGHT JUST BE WHAT WILL REVIVE THE NIGERIAN ECONOMY ONCE MORE.

FINALLY, I WOULD IMPLORE THE CBN GOVT TO STOP BEING OBSEQUIOUS TO THE IMF, WORLD BANK, ET AL IN MATTERS BORDERING ON DEVALUATION AND THE NIGERIAN ECONOMY IN ALL RAMIFICATIONS AND BE MORE PATRIOTIC AND PUT NIGERIA AND NIGERIANS INTERESTS AND WELFARE FIRST IN ALL ITS DOINGS. SO THAT NIGERIANS FROM ALL WALKS OF LIFE WILL FEEL THE POSITIVE IMPACT OF HIS OFFICE AND THE INTITUTION HE SIRE.

WE NEED POSITIVE CHANGE.

GREAT POLICY MAKERS.....GREAT.


FROM A VERY CONCERNED NIGERIAN

AUGUSTINE

Zoo man is quaking and spreading fake news.

If you believe it will bounce back, why don't you buy oil futures and make a ton of dough in a few months?

OP, nice one.

You cleared a lot of things.

However, we are still supposed to be scared.