Crude oil storage at Cushing, but not storage capacity utilization rate, at record level

Energy Information Administration ^ | MARCH 23, 2015 | Energy Information Administration

[painter]

They are. The only problem is when you max out your storage while wells are still pumping out 9.5 million barrels a day you can't build them fast enough.

Why don't they just "cap" them?

They can't,oil companies spent hundreds of billions of dollars drilling those wells and owe the banks all that money. So they have to keep pumping no matter the price so they can make the bank payments.

[thackney]

I didn’t find the articles I had read months before. The market has been in Cantango for months. Traders buy oil at current price, sell a futures contract at more than the cost of storing the oil. Lock in the sale and the storage price; instant profit, no risk. The following from about a week ago:

http://www.wsj.com/articles/oil-glut-sparks-latest-dilemma-where-to-put-it-all-1425577673

Many traders see Cushing as ground zero for the global oil glut. The city is the hub for pipelines connecting oil fields in Canada and west Texas to refineries along the Gulf Coast and is the nation’s biggest commercial storage hub by capacity. It is also a popular spot to store oil because it is the delivery point for the barrels backing futures traded on Nymex. Because of a current quirk in the market—futures prices for later months are higher than the front-month contract—traders who store oil in Cushing can lock in an agreement to sell that crude at a higher price.

Oil Futures: Reducing Risk in a Volatile Market
http://info.drillinginfo.com/oil-futures-reducing-risk-volatile-market/