Isn't there already a coal liquefaction technology to turn coal into oil? Just run the process in reverse and voilà: ACME brand dehydrated oil powder, just add water. Dig out the loose change in your pocket to rent a dry bulk ship for a day on the spot market, and Bob's your uncle.

It’s also worth remembering that this time of year is usually a bit of a lowpoint for the oil and products mkts. Demand may pick up a bit around the holiday season, and considerably more come the spring.

There’s been some floating storage used for LNG recently too, as it happens, though only for a matter of weeks.

But wait, that’s abut 11% of one day’s output….

Let’s not get too carried away.
- ckm

No, unrelated. Oil is not dry. Coal, grains, iron ore…. stuff like that is dry bulk shipped.

If the report is correct then it suggests Asian demand is down, because that’s where most of the VLCC (huge 300,000+ ton) tankers go. Part of the problem is that it takes a while to slow down production in an oil field, so that oil has to be put someplace.

Tanker rates for Suez Max (175,000 ton barely fit through Suez ships) have also cratered, especially west Africa-to-US and Europe rates.

The risk is probably unchanged, and may even be reduced, since instead of normally being full of oil and moving it from A to B, they are full of oil and not moving at all.

parking them in the Gulf of Mexico at $100,000 a day.

Given a 2 million barrel tanker, if the price of oil isn’t increasing at least 5 cents a day, this will be a losing proposition. But today, aren’t the rental rates $10k (or less)? (cf. BDI articles mentioned here).

Most recently after Hurricane Ike the Mexican sold a huge amount of oil cheapky. The Majors bought it all up and put it on VLCC and have been parking them in the Gulf of Mexico at $100,000 a day.