By: GZ on Mercoledì 28 Marzo 2007 12:22
Il balzo del petrolio di ieri sera da 63 a 67 e anche il rialzo da 59-60 a 62-63 dei giorni precedenti è piuttosto artificiale, forse l'Iran che è notoriamente nei guai finanziariamente (la sua produzione cala ed è in deficit pesante) aveva bisogno di incassare di più e poi ci sono questi fondi che sono pesantemente long da da livelli più alti da quello che sembra nel COT
Un pezzo del 22/3 su TheStreet.com ha interessanti dati a riguardo del contango impressionante che si vede ora sulla curva dei future al Nymex, cioè dice che questi 68 dollari che vedi sul contratto di settembre riflettono la posizione di alcuni mega fondi al rialzo e da cui presumubilmente escono appena possono
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A Monster Carry in Crude
By Daniel Dicker
TheStreet.com Contributor
3/22/2007 7:42 AM EDT
URL: http://www.thestreet.com/pom/pomrmy/10345898.html
This column was originally published on RealMoney on March 21 at 2:31 p.m. EDT. It's being republished as a bonus for TheStreet.com readers. For more information about subscribing to RealMoney, please click here.
In 2003, the way crude oil traded changed significantly. Before then, crude oil was priced seasonally: Premium months tended to be in the winter and summer, and often the crude spot month traded at a premium to the next nearest month.
As prices seismically shifted from $28 per barrel in 2003 to ultimately $80 per barrel in the summer of 2006, the crude price curve shifted as well. We haven't seen a premium spot month since. But the spot-month action we just witnessed in crude, the April '07, might be indicating a similar seismic shift in the way crude oil could trade for a long while to come.
Monster Carry
Normally, the price between months of crude oil should represent a simple equation: what it would cost to buy, take delivery of and store barrels for 30 days. Other factors, such as storage availability, tanker schedules and weather, can play a role, but carry generally has translated to somewhere between 25 cents and a dollar.
Last month saw the April to May carry go over $3. This goes far beyond storage fundamentals, folks.
In fact, it goes so far beyond that it seems clear to me what has caused such a major spread price shift: hedge funds. In fact, there's so much obvious hedge fund action in the last month's price move that it could be giving us insight into what might happen for the next few months as well. Let's take a look at the latest Nymex report from the CFTC commitments of traders:
CRUDE OIL, LIGHT SWEET - NEW YORK MERCANTILE EXCHANGE
FUTURES ONLY POSITIONS AS OF 03/13/07
NONCOMMERCIAL COMMERCIAL TOTAL NONREPORTABLE
POSITIONS
LONG SHORT SPREADS LONG SHORT LONG SHORT LONG SHORT
(CONTRACTS OF 1,000 BARRELS) OPEN INTEREST: 1,322,242
COMMITMENTS
172,387 135,273 236,274 841,942 863,258 1250603 1234805 71,639 87,437
CHANGES FROM 03/06/07 (CHANGE IN OPEN INTEREST: 47,048)
305 -486 6,336 28,290 30,054 34,93 35,904 12,117 11,144
PERCENT OF OPEN INTEREST FOR EACH CATEGORY OF TRADERS
13.0 10.2 17.9 63.7 65.3 94.6 93.4 5.4 6.6
NUMBER OF TRADERS IN EACH CATEGORY (TOTAL TRADERS: 314)
72 114 127 95 99 256 268
Source: CFTC
Notice particularly the changes for those "noncommercial" positions: Long positions are up, short positions are down, and spread positions continue to go up. In addition, the number of long noncommercial traders (72) is significantly less than the number of noncommercial shorts (114), despite the fact that the longs hold 37,000 more contracts of open interest. Remember, this is only the latest CFTC report. The previous reports of the past few weeks also support this trend.
Let's translate: "Noncommercial" refers to participants who do not represent any oil assets or services of any kind -- in other words, funds or trading groups. The lines can get blurred, believe me, as many trading companies have masqueraded as oil companies for years, but if you get counted in the CFTC reports as a "noncommercial," it's only because you cannot make even the barest claim to having any commercial interest in the price of oil. The number of traders is very significant in that a much smaller number of funds hold a much larger number of longs in this market.
The bottom line: There are a relatively small number of very big funds that remain very long the crude oil market.
Roll With It
Not only that, but they were forced to "chase" their long position in a very bad way last month. Funds that are long the market and want to keep their positions execute what is known as a "roll": They will sell their front-month longs while simultaneously buying the next month out -- they will "buy" the spread.
At the start of the month, funds were looking at a roll of about 75 cents to 80 cents. So, as an example, if a fund was long at $58 in the April, they assumed, without a move in the market, that their corresponding longs would be established at $58.75 in the May.
Now, depending on when they executed their roll, their costs for maintaining their longs got much worse: If they didn't finish their roll until the last few days of the trading month, they possibly bought their May contracts as badly as at $59.50, a loss of 75 cents, but also sold their April contracts at $57 or worse, another loss of a dollar per contract. As the month went forward, each fund that wanted to stay long (and even those that wanted to get out) helped chase the April price down, while chasing the May price up.
So we know that a lot of funds are long crude oil at some very disadvantageous prices. What could this mean going forward?
For one thing, it assumes that a number of fund players will be looking to trim positions (and losses) as the market goes up, putting a cap on upward market action, at least for a while. Further, for those who still believe in their long positions and want to maintain them through the year, they continue to run the risk of chasing spreads each month as they roll. Many will look to roll sooner in the month, and in anticipation of this, spreads all along the crude curve are bloating to well over a dollar, even as far out as July.
So it seems to me that there are some artificially high crude prices further out on the curve, prices that have a built-in downside potential as they reach the spot month, or at least until these funds trim down their positions.