World’s biggest storage firm running out of space to store oil

World’s biggest storage firm running out of space to store oil

- The world's largest independent oil storage firm, Royal Vopak NV, has revealed it is running out of space to store products

- The outbreak of the coronavirus and the fall in oil prices have been identified as the cause as there is limited space to store products

- The fall in prices have compelled traders to pay buyers to take up products due to challenges with transportation and storage

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Rotterdam-based Royal Vopak NV, the world’s biggest independent oil storage firm, has revealed it is quickly running out of space to keep the oil.

The firm revealed that its space for crude and refined products is almost completely occupied due to the outbreak of the coronavirus.

The revelation follows news of the global price of crude oil diving into the negatives, compelling traders to pay people to take barrels of the product.

Royal Vopak NV: World’s biggest storage firm running out of space to store oil
Oil barrels Source:
Source: UGC

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Per a report by Bloomberg, this has led to the parking of unwanted supplies on tankers due to the fact that shore-based facilities are full.

Reports available show that in the North Sea, some vessels are idle and have been filled with gasoline and jet fuel for days.

This has compelled traders to opt to store oil at sea and the current capacity is estimated to be almost 250 million barrels.

Earlier, reported that oil prices in the United States of America (USA) dropped by a historic 305% and now sells at -$36.73 per barrel.

The historic fall on Monday, April 20 saw traders unloading positions ahead of the May contract’s expiration on Tuesday, April 21.

Presently, buyers are being paid to take delivery as there is cost associated with transportation and storage.

Per a report by Yahoo Finance, the June contract was trading lower by 18% at $20.43 a barrel.

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