- Two dozen tankers loaded with oil are anchored off the California coast.
- The tankers have no place to offload the crude due to COVID-19 restrictions.
- Tankers are used to store products that would have originally gone out to the supply chain.
- The cost to have a barrel crude delivered in the U.S plummeted to negative $37.63.
- This is the highest volume of crude to ever float off the West Coast.
- ExxonMobil reopened to start producing hand sanitizer for first responders.
According to an article published in Fox News and CleanTechnica, a video released by the Coast Guard in Los Angeles offers a stark illustration of the global oil glut amid coronavirus lockdowns in the U.S. and elsewhere.
Tankers anchored off California coast
The #USCG is closely monitoring the increased presence of tanker vessels anchored off the coast of Southern California. pic.twitter.com/i6HuX6wxgn
— USCG Los Angeles (@USCGLosAngeles) April 24, 2020
The brief footage shows more than two dozen tankers — each the length of several football fields — anchored Thursday off the coast near the ports of Los Angeles and Long Beach.
They are floating storage tanks filled with oil neatly distanced from each other.
Situation monitored closely
“Due to the unique nature of this situation, the Coast Guard is constantly evaluating and adapting our procedures to ensure the safety of the vessels at anchor and the protection of the surrounding environment,“ Coast Guard Cmdr. Marshall Newberry said Thursday.
“Coast Guard watchstanders, in partnership with the Marine Exchange of Southern California, are closely monitoring each anchorage to manage the increased number of tank vessels we’re seeing off the California coast,“ he said.
No place to offload
The tankers have no place to offload the crude, which is going unused as closures of businesses and restrictions on travel — meant to slow the spread of the virus — continue to cause a plunge in demand for oil, The Los Angeles Times reported Friday.
“The supply chain is being backed up, and tankers are now being used to store product that would have originally gone out to the supply chain,” American Petroleum Institute spokesman Scott Lauermann told the paper.
Demand for oil collapses
The cost to have a barrel of U.S. crude delivered in May plummeted to negative $37.63. It was roughly $60 at the start of the year.
The tankers are carrying enough crude oil to meet the needs of 20% of the world’s oil consumption, yet they have nowhere to go. This is due to the demand for fuel collapsing. These tankers are pretty much-floating storage units for barrels of oil.
There are almost three dozen ships — which means that more have come after the Coast Guard put out its press release. This is the highest volume of crude to ever float off the West Coast at one time — more than 20 million barrels of crude oil. And these tankers have been floating steadily for 8 days.
Drowning in oil
With everything being shut down and people staying home, there are fewer people buying gas (only essential personnel). Oil refineries have shut down temporarily.
Here in Baton Rouge, ExxonMobil reopened to start producing hand sanitizer for first responders.
Drums normally used for oil are now being filled with isopropyl alcohol and Exxon will be donating a batch of 160,000 gallons of sanitizer. This is enough to fill 5 million bottles.
This is one reason why there are oil tankers floating off our coasts with nowhere to put their oil.
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Source: FoxNews & CleanTechnica