Crude is screwed, man.

Then I stand corrected. My apologies.

As for Fisher's book, it has been years since I looked at it, but I don't recall him ever mentioning them.

 

Here is one way to think about this. Physical players have very valuable data about the market that you or I will never have. They guard this data closely. What we can do though is observe what they do with that data by examining their footprints in the market. We can see their footprints in the forward curves. Think of this like tape reading. Back in the day I use to trade listed stocks and read the tape by examining how a specialist was bidding and offering for stock knowing that he/she KNEW what the order deck looked like. So by watching how a specialist used that information, I could figure out if there were more buy orders or sell orders left in his deck. This is the same thing. By examining the curve, I can peek at the dealers cards. It's only a peak, but it's better then guessing.

 

I understand the rationale, I just didn't know how material or reliable it is.

 

What are you talking about? While I would never trade against the trend the long term fundamentals clearly favor lower oil prices. The marginal cost of extracting oil outside the middle east clearly are going down over time. Less oil demand from renewable energies. Battery powered cars. New chemical compounds that reeuce crude derivative inputs. All those speak for lower oil prices not higher ones. But its way too early to even think of shorts

 

Solar is what we need.

 

That would have an adverse effect, sir. Higher prices in the backend incentivice producers to invest in new projects which will result in over supplies down the road.

 

For the top oil producing nations this whole game is not about profit or profit margins at all. Hence the disagreements among opec mrmbers.its all politicized and about market share, especially between Iran and Saudi Arabia

 

Forwards in any asset class have zero predictive value for short term trading, there is tons of research in the open that supports this point. Forwards are priced based on no arbitrage arguments and neither sport nor forward price changes now nor forward curves have any predictive value for tomorrows prices or price changes in 1 hour

 

How so? Disagree vehemently. I traded and made markets in forwards of many many different underlying assrts and structured exotics using forwards all the time and could not disagree more with your assertion

 

That fact has nothing to do with forward curve changes now and their correlation with changes at t+n whatsoever.