World oil storage capacity is almost exhausted
The world's largest independent oil storage company said traders' storage space for crude and refined oil was nearly exhausted as a result of the rapidly expanding oversupply caused by Covid-19.
“The available oil storage facilities are almost completely sold out at our terminals,” said Gerard Polides, CFO of Royal Vopak NV in Rotterdam, in an interview. According to him, for Vopak, the available capacities around the world, which are not currently in use, have been almost completely exhausted, and a similar situation is observed around the world. The company seeks to complete maintenance as quickly as possible in order to free up more capacity. World oil demand collapsed at an unprecedented rate because coronavirus caused a massive stop to global transport systems and damaged the global economy. Due to the inability of manufacturers to keep up with the trends, an overabundance of oil and fuel quickly appeared. May crude oil futures in the US moved to negative territory - this meant that traders were actually willing to pay people to take the oil. The main reason for this rapid drop in oil quotes, analysts called concerns about the capacity for oil storage. As previously reported, on April 21, world oil quotes accelerated a three-fold decline due to panic expectations of overfilling of oil storage facilities in the USA and Europe. The panic began around noon.