Contango is back

Discussion in 'Commodity Futures' started by TraDaToR, Jul 17, 2014.

  1. The only floating arb I see open in Brent is the V/X roll if you can find a VLCC, however it only appears open by 20-25 cents (~$400k). X/Z and everything on out appears closed.

    In addition to the several mentioned by Reuters, Mercuria last week also fixed the 130kt Stena Suede from Teesport to Saldanha however rate not disclosed. Shell booked Sonangol Porto from Girassol to South Africa.

    It does appear that Saldanha has cheaper storage than other places, but empty so far. I would not be surprised if Mercuria picked up South African storage assets from JPM.

    [​IMG]
     
    Last edited: Aug 27, 2014
    #11     Aug 27, 2014
  2. #12     Aug 28, 2014
  3. I don't buy the 300k lot hedge argument. We have a falling market and short covering is certainly conducive to bottoming and shorts taking profit.

    The Rosneft deal has been put on hold because of US/EU sanctions that Glencore and Vitol must adhere to. When Russia/Ukraine issues blow over and sanctions ease, you can expect this deal to move forward.
     
    Last edited: Aug 28, 2014
    #13     Aug 28, 2014
  4. However, I could very well be wrong about all of that.
     
    #14     Aug 28, 2014
  5. Karvounis arrived in Saldanha this morning and looks to be fully laden at 14.2m draft. Itinerary history suggests the vessel is carrying ~350k bbl of Brazilian medium sweet Roncador, exported from the Angra dos Reis terminal on Aug 3-4. Will be interesting to see where this one goes in the next few weeks - might be a simple import, might be floating storage - hard to tell at this point.

    [​IMG]
     
    Last edited: Sep 1, 2014
    #15     Sep 1, 2014
  6. Correction to my last post: I think Karvounis is actually carrying ~700k bbl of Roncador crude (not 350k).

    And per Reuters:

    Right on schedule and laying 15.2 meters in the water, looks to be carrying 1.0 - 1.05mm bbls.

    [​IMG]
     
    #16     Sep 1, 2014
  7. How do you calculate the 20-25 cents here? And while I am sure the answer will be something along the lines of 'As little as someone is willing to take...' But what kind of minimum profit do you need to see before people decide its worthwhile to store?
     
    #17     Sep 2, 2014
  8. The VLCC rates at the time were roughly 50c/bbl and the V/X Brent spread was trading in the high 70s when I wrote that. The standard VLCC can hold ~2.0 million bbls.
     
    Last edited: Sep 2, 2014
    #18     Sep 2, 2014
  9. Karvounis unloading...

    [​IMG]
     
    #19     Sep 2, 2014
  10. TraDaToR

    TraDaToR

    This is so interesting. I know some physical trading firms have databases with production, local consumption, production available for exports, imports needed...per country and derive trading systems from it, but I wonder if you can create a valid methodology out of marinetraffic...It would be awesome.:)
     
    #20     Sep 2, 2014