CL is droping a couple of bucks today.
CL Redux
- Thread starter schizo
- Start date
after it goes to 108?
note: theres a large spread to the front months
http://www.cmegroup.com/trading/energy/crude-oil/light-sweet-crude.html
this big Backwardation in front months reflects the following.
a) mainly NEW pipelines that became operational from Cushing to OIL Refineries .
b) new Raill road Network established to take out Cushing Crude to Refineries
c) this historic HIGH inventories ( we had this same HIGH level of Invetories couple of times in 2010 and 2011 , but we did NOT get BACKWARDATION in those instances due to lack of sufficient Pipe lines to take out Cushing Crude to Refinaries )
you guys remember good old days 2009 - 2012 , where we had faithful CONTANGO ( front months prices are always LOWER than FAR months ) , now the CONTAGO is history for good with many NEW PIPE LINES came into operation to PUMP OUT Crude from Cushing .
Here is fun trade , today people bought $140 , $150 SEPTEMBER CALL options for 2 cents/1 cent ( total contract $20 and $10 ) with Volume 417 and 206 ( scroll all the way bottom to see this Volume )
http://www.cmegroup.com/trading/ene...&floorContractCd=CLQ3&expMonth=201308&prodid=
a) mainly NEW pipelines that became operational from Cushing to OIL Refineries .
b) new Raill road Network established to take out Cushing Crude to Refineries
c) this historic HIGH inventories ( we had this same HIGH level of Invetories couple of times in 2010 and 2011 , but we did NOT get BACKWARDATION in those instances due to lack of sufficient Pipe lines to take out Cushing Crude to Refinaries )
you guys remember good old days 2009 - 2012 , where we had faithful CONTANGO ( front months prices are always LOWER than FAR months ) , now the CONTAGO is history for good with many NEW PIPE LINES came into operation to PUMP OUT Crude from Cushing .
Here is fun trade , today people bought $140 , $150 SEPTEMBER CALL options for 2 cents/1 cent ( total contract $20 and $10 ) with Volume 417 and 206 ( scroll all the way bottom to see this Volume )
http://www.cmegroup.com/trading/ene...&floorContractCd=CLQ3&expMonth=201308&prodid=
good to know you find these articles useful .
There are on various sites, when I see good articles I post here for the benefit of community . As you can see the URL link on each article these are from various sites.
<b>Message to community: please feel free to comment/contradict on my OBSERVATIONS , that is how we learn different point of views , I VERY MUCH appreciate contradicts/comments on my posts . </b>
FIB Retracement from day LOW to HIGH at 61.8% level shows $106.64 , seems we are headed there
This article shows the complexities involved in estimating physical supply vs. demand ( in short time spans ) in Crude , Gasoline at different US locations ( PADD1 etc.. )
As Big speculators and Hedges get information from various resources ( Refinaries , PADD 1 etc.. ) , we see these big swing in prices ..
Oil markets proving a study in supply and demand
http://www.futuresmag.com/2013/07/1...udy-in-supply-and-demand?t=commodities&page=2
As Big speculators and Hedges get information from various resources ( Refinaries , PADD 1 etc.. ) , we see these big swing in prices ..
Oil markets proving a study in supply and demand
http://www.futuresmag.com/2013/07/1...udy-in-supply-and-demand?t=commodities&page=2
Interesting WTI monlty Roll calculation I got on internet recently ....
The front WTI backwardation if sustained and rolled will provide close to 17 $/bbl of positive roll returns for crude oil indices (ETFs etc..) over a year. With free money chasing any yield, a 16% annual roll return in WTI should attract considerable amount of financial flows; the WTI backwardation will have to come off before flat price can.
The front WTI backwardation if sustained and rolled will provide close to 17 $/bbl of positive roll returns for crude oil indices (ETFs etc..) over a year. With free money chasing any yield, a 16% annual roll return in WTI should attract considerable amount of financial flows; the WTI backwardation will have to come off before flat price can.