From a glut in the U.S. supply to fears concerning what will happen now that sanctions on Iran have been lifted, the market for oil is tanking considerably — so much so that one supplier of crude in North Dakota finds itself in the odd positionof paying people to take its product.
North Dakota Sour, a high-sulfur crude that’s more expensive to refine than other varieties, has now been listed at -$0.50 per barrel — down from $13.50 per barrel a year ago and $47.60 per barrel in 2014, Bloomberg reported.
“Telling producers that they have to pay you to take away their oil certainly gives the producers a whole bunch of incentive to shut their wells,” said Andy Lipow, president of Lipow Oil Associates, LLC, about the current crude surfeit, according to Bloomberg. The news outlet also cited executive vice president of Turner Mason & Co., John Auers, as explaining that this particular crude only represents a small portion of North Dakota’s production, with “15,000 barrels a day coming out of the ground.”