Contango is back

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

  1. Oil glut spills into diesel, gasoline as storage demand swells

     
    #141     Jan 9, 2015
  2. xandman

    xandman

    Your thoughts on Refiners margins? Thanks.
     
    #142     Jan 9, 2015
  3. NoBias

    NoBias

    In the event someone finds it useful. I located a Symbol for WTI Spot "Monthly/Weekly DOE data" which can be loaded in Tradingview

    [QUANDL: DOE/RWTC] "less space ET turns it into a smiley" "less space, ET turns it into a smiley"

    (Delayed, EIA/Quandl data appears to update slowly, not ideal but may be useful for historic reference)

    Ref sources:
    Quandl WTI Crude Oil Spot Price Cushing, OK FOB
    EIA Cushing, OK WTI Spot Price FOB
    EIA Spot prices petroleum and other liquids

    WTI [CL] Spot weekly.jpg
     
    Last edited: Jan 10, 2015
    #143     Jan 10, 2015
  4. NoBias, I've seen those. All delayed by several days. Anyone know where to get realtime spot, including worldwide quotes? I know there's about 200 grades of oil, but I'd like to see what's going on with as many as possible.


    I noticed contango widened into the Friday close. Looks like a wide enough spread that more tankers will be used for storage. And it looks like many places are near maximum storage capacity of refined products so we should start to see refinery production fall pretty soon and have more raw oil go into storage.
     
    #144     Jan 10, 2015
  5. I take it as more tankers continue to get booked up for storage, this will help put pressure on contango? But what will allow it to keep expanding beyond these levels?
     
    #145     Jan 11, 2015
  6. Murphmack, I didn't watch oil in 2008/9 so I'm just guessing that as storage capacity becomes scarce, there will be less demand for spot oil and oil for delivery. So it would put downward pressure on the front of the curve, pushing oil further into contango.

    Storage of oil and selling futures contracts against that oil will push the back of the curve downward, decreasing contango.

    At least that's how I'm expecting things to work; we'll see. I expect major support at ~$40/bbl, as there are a lot of 'experts' calling that point the bottom for oil. I disagree, but will be playing my oil short very carefully when WTI gets down to the low 40s. So far, this has been the best trade I've made since going long TSLA in the 30s right before they reported their first profitable quarter.

    I'm still trying to figure out the advantage of the calendar spreads; they look like they're thinly traded and don't have much profit potential. At this point, I'd rather play an out of the money bear call spread on USO options than a calendar spread.
     
    #146     Jan 11, 2015
  7. #147     Jan 12, 2015
  8. So the driver behind this type of curve steepening is really dependent upon the relative scarcity of storage? How do you guys typically monitor the demand for storage?

    I've been long on the Jun/Dec calendar for WTI since $2.00, it dropped from $4.60 to $4.00 that one day. Closed it at $4.11, re-entered yesterday for 1.5x the size at $4.00 after it started coming back up.
     
    #148     Jan 12, 2015
  9. #149     Jan 12, 2015
    iflyjetzzz likes this.
  10. Does anyone know what numbers traders look at to determine China Oil Import data? Are there release times when we can expect /CL to move in response?
     
    #150     Jan 12, 2015