Explainer: The hidden costs of oil storage

With the influx of renewables on the grid in recent years and the slump in demand due to Covid-19 health crisis, the price of oil has plummeted. So is there case to be made to store up oil at these low costs for when times are hard? Or should the global pandemic be the catalyst to leaving oil in the ground? We take a look at some of the figures.

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In mid-April, oil prices fell negative for the first time ever driven by low demand, a saturated market, and an energy system turning to renewable energy.

Storing oil on vessels has become a must for some traders as tanks are full. But the longer the oil sits there, the less economic it will become. Meanwhile, oil production continues. 

Surely, the historic collapse on the oil markets is an indication that fossil fuels are a thing of the past, and investors should look towards stablising prices of renewable energy?

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