With shoreside tank farms filling up rapidly and crude oil trading at historic lows, commodity traders are turning to floating storage as a way to save up their oil for better days. As of Thursday afternoon, there were 27 tankers anchored and waiting off the coast of Southern California alone, according to the U.S. Coast Guard.
When including additional vessels in the San Francisco area, Bloomberg estimates that the idle tankers off California’s coastline contain as much as 20 million barrels of petroleum, an amount roughly equal to the (pre-coronavirus) daily demand of the entire United States. Tanker tracking firm Kpler SAS suggests that most of them have been stationary for more than a week.
The U.S. Coast Guard says that it is keeping a careful eye on the accumulation of so much stored crude off California’s coastline.
“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,” said Cmdr. Marshall Newberry of Coast Guard Sector Los Angeles/Long Beach. “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.”
The same pattern may be found at many other large anchorages around the world. According to data from analytics firm Vortexa, an estimated 114-150 million barrels of crude oil are in storage at sea worldwide. Nearly 70 million barrels of oil products – diesel, gasoline, jet fuel and other refined petroleum – are also currently stored aboard clean tankers around the globe, the company assesses.