distillates

About Those Secondary Speculators

Back when the WTI curve was at its steepest contango, who was it that was buying up all that oil? A sheer vertical curve is an invitation to almost free money, very much like other curves everywhere else during the “rising dollar.” You could simultaneously buy crude at spot and sell it for delivery years ahead using a futures contract, [...]

The Inconvenience of Oil

By Jeffrey P. Snider|2017-01-25T17:53:51-05:00January 25th, 2017|Currencies, Economy, Federal Reserve/Monetary Policy, Markets|

For the first time in three years, oil inventories in the United States are not rising precipitously more than the seasonally expected. At the start of both 2015 and 2016, oil stocks exploded higher as oil prices crashed, all related to the “dollar” flex on the front end of the futures curve creating sufficient contango necessary to strip that oil [...]

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