A few weeks back I spent most of a class day talking about a long post about how the oil industry works.
One of the things I noted in passing is that there's never that much oil in storage. Some, but there's just not infinite room for it. Also, a good fraction of the oil that is "stored" is not actually in tanks, but in the pipelines from the tanks and wells to the refineries (basically, the pipelines can hold a lot). There's actually an aphorism for this: "store it in the ground" by not bringing it to the surface just yet.
A seemingly unrelated issue that I also mentioned at some point regarding Russia is that many oil wells can't be turned off readily. The oil is coming up, and it has to be sent somewhere. In many cases, to stop a well from production pretty much means to ruin it for good. It's not straightforward, and there are safety issues. In the U.S., when well are shut down it's required by law that they be sealed by pouring concrete down them so they can't be opened up again. Safer to drill a new one from scratch off to the side, than to re-open them.
Anyway, if you put those two together, a slow moving problem that has been approaching Russia is that if they can't sell their oil, and their storage fills up, they'll have to destroy wells.
That day may be here. Transneft is a Russian company that operates the largest pipeline network in the world. This map is in Russian, but is all I could find:
Transneft has notified oil drillers that they are out of room, and are limiting intake. Further, they want proof that there is a buyer who will take any oil they agree to store.
The article does talk optimistically about future upturns in Russia's oil sales. I'm not clear on this, but my guess is that what is going on is that the oil firms are still booking sales for April and May that may ultimately be cancelled.
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