With the expiration of WTI's May contract on Tuesday, traders who had previously held large positions sold wildly at the last minute.
Because WTI crude oil futures are settled in kind, and the storage space in the United States is running out, investors who have not closed their positions in advance can only sell them like this. This also led to the WTI May contract closing at -37.63 USD/barrel on Monday, which was negative for the first time in history.
But in fact, not everyone has fallen into this dead end, and Icahn is one of the exceptions.
As an investor who became famous as early as1980s, Icahn, 84, has a rich portfolio, which enabled him to find a bargain in this oil price crash crisis.
Icahn holds as much as 70% of the shares in a refinery called CVR Energy located in the Midwest of the United States. As a refinery, the plunge in oil prices has undoubtedly brought opportunities to buy stocks at low prices. As for negative oil prices, it is even harder.
In an interview with the media on Friday, Icahn said, "You may never see this opportunity again."
Icahn said that he usually doesn't get involved in trivial matters, but when the oil price plummeted, he urgently asked CVR Energy Company to open a futures account and take advantage of this rare opportunity to buy quickly to fill the inventory.
He said:
Icahn said that CVR tried to buy1-2 million barrels when the oil price fell to negative value. He didn't disclose how much he finally bought, but he said, "We made some money and did buy a lot."
As a refinery, CVR needs crude oil to produce gasoline and other related products. Therefore, as long as business is running normally, there will always be a demand for useful oil. CVR has its own storage facilities, and the cumulative storage capacity of its oil tanks is about 6.4 million barrels.
Icahn's reaction shows his intuition as an investment veteran.
However, it is worth noting that although crude oil was bought at a low price, in Icahn's view, there doesn't seem to be much to be thankful for.
He said in the above-mentioned media interview, "If the oil price has been so bad, then everything is in danger."
That's true, because oil prices have been falling, and his crude oil-related assets have lost a lot of blood.
Take CVR Energy as an example, its share price has fallen by half since the beginning of the year, with a drop of 53%.
Occidental Petroleum, another oil company he invested in, performed even worse, falling by 66% this year.
Western oil companies sought financing from Buffett when they acquired Anadarko Oil Company. Now the plunge in oil prices has left it in deep trouble. In order to pay Buffett a quarterly dividend, western oil companies were forced to issue additional shares worth $257 million.