Old Jed's A Millionare!

Based on yesterday's How Low Can You Go? post about crude prices being negative, that price ain't for you and me.

So before you try to become a quick millionaire and head over to your local refinery and say, give me a load of them barrels, and give me $35, too - it don't work like that.

That price is for crude traders.

These are guys who buy and sell future barrels of crude. They will put an order in to buy, say, a million barrels of crude in May.

They don't want the crude.   They intend to sell the crude - to other traders or to a refinery or a wholesaler.

So since all the oil storage tanks and all the oil tankers are full, no one wants the crude.

So unless these traders can sell those "futures", on May 1st they are going to get a million barrels of crude delivered to their office on Wall St!

Awk!

So....we come to yesterday - and everybody is unloading those futures.  None of these guys who buy and sell the crude futures to each other, want them.

So they wind up paying refineries - who also don't want them - to take them.  At least they have some storage tanks.  How many barrels can you fit under your desk. Two?  Maybe three at most.

Anyway, two points;

1. Don't plan on getting rich real quick with a trip to your local refinery.  And,
2. Don't plan on Esso or Shell paying you take take their worthless, stinking, dirty gasoline off their hands.  Because gasoline pricing don't work like that either.

For two reasons:

1. The price of current crude is not negative, only the futures.  It is not even zero.  It's about $20/Bbl.
2. And the price of crude, of course, is only one component of gasoline.  The largest component being....tax.

What's that?  Enough information?  Ohhh....  Too much information.

Okay, on to the big finish.  New COVID cases yesterday.....

Quebec, Ontario and now Alberta continue to be the largest contributors.

And the mortality view......

Another spike in Quebec.  Triple the rate (per million population) than the next highest province, Ontario.  And Ontario more than twice as high as the next province (BC).  Population density must certainly be a contributing factor.


Oh, and if you think it's only Canada's oil & gas sector taking a hit, it is also forestry.

Nobody's buying homes so nobody is building them.  So you don't need lumber.  Two of Canada's biggest revenue generators taking it in the shorts.

But worse than that - no byproduct of the lumber industry; wood chips.  And you know what is made from wood chips....?

Toilet paper!!!