Sorry, but there was never an oil storage crisis
Likely not, according to Robert Rapier of Energy Trends Insider.
In fact, we're not even close.
Rapier writes that "oil producers could continue to add a million barrels a week (which is about the average over the past year) for nearly 4 years before crude oil storage is actually full."
The most well-known storage facility, in Cushing, Oklahoma, would run out of space much sooner than that at the current rate (about four months from now). But that still isn't going to happen, according to Rapier:
We are currently in the season when refinery utilization is lowest. Refiners take equipment offline in fall and spring to do maintenance, so they use less crude oil at this time of year. This maintenance usually peaks in March, and then crude oil demand picks back up as refiners gear up for the summer driving season. The difference in refinery demand between this time of year and summer is generally around a million barrels per day, so even if nothing else changes that storage build should start to flatten.
In other words, we may have already hit peak crude storage here in the US, and if not we're getting very close.
Over at Reuters, John Kemp writes that the market doesn't actually seem very worried about storage capacity.
If the market was concerned about space at Cushing and onshore more generally, the contango would have widened even further as stocks rose to make it profitable to use more expensive offshore storage.
However the term structure of futures prices has remained essentially unchanged for the past two months - implying traders are not particularly concerned about storage issues and do not foresee the need for more expensive options like floating storage.
(h/t @tradescribe)