Source: freedomoutpost.com
By MAC SLAVO

While oil prices have jumped about 50% in recent weeks, there appears to be no real reason for the move other than pure speculation and billion-dollar market cash infusions from unknown plunge protection teams.

But as the mainstream media continues to tout non-existent reduction agreements between oil producing nations, the following evidence suggests that the world remains awash in oil, so much so that there is no space to store it… anywhere on earth.

The following report from Zero Hedge explains just how much oil is currently sitting in limbo while suppliers try to figure out what to do with it:

Last week we revealed what we thought was a “shocking photo” of nearly 30 oil tankers caught in a traffic jam off the Iraqi coast, an indication of just how much excess oil is currently parked offshore.

But the photo above, meant to do DB’s thesis justice, was nothing in comparisons to what Reuters would reveal today.

Because as ports struggle to cope with a global oil glut, huge queues of supertankers have formed in some of the world’s busiest sea lanes, where some 200 million barrels of crude lies waiting to be loaded or delivered, Reuters reports today.

The vessels, filled with oil worth around $7.5 billion at current market prices, would stretch for almost 40 km (25 miles) if formed up in one straight line.

Something not quite so theoretical, and yet almost identical taking place right now, is shown in the photo below, which shows VLCC supertankers traveling between India and Southeast Asia, courtesy of Reuters.

And while the market is for now clearly ignoring the unprecedented accumulation of oil in offshore storage, a bearish indicator of just how much oil will hit markets if and when prices continue rising or when collapsing contango makes it no longer economic to hold for many it is an all too real daily existence.

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The unprecedented number of ships at sea filled with cargo and just waiting for the signal to offload is also causing congestion between the main producer and consumer hubs.

Almost all supertankers heading to Asia pass by Singapore or adjacent facilities in southern Malaysia, the world’s fuel station for tankers and also a global refinery and ship maintenance hub.

Shipping data shows that some 50 supertankers are currently anchored in or close to Singaporean waters for refueling, maintenance or waiting to deliver crude to refineries or be used as floating storage.

This can be seen in the following Reuters photo of oil tankers lining up on the eastern coast of Singapore.

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