Contango And The Distillate Market

Oil retreated on Wednesday as optimism spurred by talk the IMF may do more to help resolve the European debt crisis proved shortlived, with a gloomy demand outlook pressuring prices. Front-month Brent crude was down 40 cents at $111.13 a barrel by 1432 GMT, after touching an intraday peak of $112.20. U.S. oil gained 46 cents $101.17 a barrel. Brent futures hovered in backwardation, just above parity, as prompt oil was priced comparably to forward futures, illustrating weaker demand at the front of the curve. "The market is soft, the Brent curve is flirting with contango and the distillate market is being crushed, with heating oil margins in the United States collapsing," said Seth Kleinman, analyst at Citigroup. "We've lost a lot demand from warm temperatures." Oil was supported by ...

NEW YORK (Reuters)- For the small club of companies who trade the food, fuels and metals that keep the world running, the last decade has been sensational. Driven by the rise of Brazil, China, India and other fast-growing economies, the global commodities boom has turbocharged profits at the world's biggest trading houses. They form an exclusive group, whose loosely regulated members are often based in such tax havens as Switzerland. Together, they are worth over a trillion dollars in annual revenue and control more than half the world's freely traded commodities. The top five piled up $629 billion in revenues last year, just below the global top five financial companies and more than the combined sales of leading players in tech or telecoms. Many amass speculative positions worth ...

(Reuters) - Oil jumped more than 3 percent on Tuesday, snapping a four-day losing streak on efforts to strengthen the euro zone rescue fund and concerns about U.S. fuel supplies. European officials were seen considering plans to boost the size of the region's bailout fund and to recapitalize banks, sparking hopes of an easing in the debt crisis that has dragged stock markets and commodities this month. Equities rose and commodities gained, with gold also shaking off four days of declines. End-of-quarter and technical buying also provided lift. "What we might be seeing is some end-of-the-quarter bookmarking," Gene McGillian, analyst for Tradition Energy in Stamford, Connecticut. "Right now, the (U.S. crude futures) market may have triggered some technical buying at the $80 level, I ...

(Reuters) - Brent crude touched a two-week low near $111 on Monday, down by nearly $3 on investor pessimism that economic growth will slow after Japan's earthquake and tsunami, while easing unrest in the Middle East threw the focus back onto ample oil supplies. April Brent fell as much as 2.4 percent to $111.16, the lowest price since February 25. It was down $1.64 at $112.20 at 0750 GMT (3:50 a.m. ET), while U.S. crude fell $2.15 to $99.01, after hitting an intraday low of $98.55. Brent reached a 2-1/2-year high of almost $120 on February 24 as a civil war erupted in Libya, disrupting oil exports. Japan's strongest earthquake on record on Friday shut refineries and industrial plants in the world's third-largest oil consumer. Infrastructure damage may curb demand in the near term, while ...

(Reuters) - Oil hovered near the highest price levels in more than two years, as accelerating manufacturing activity in industrialized economies and winter weather fanned expectations that U.S. crude inventories will continue to drain. U.S. crude for February fell 12 cents to $91.43 a barrel at 0721 GMT (2:21 a.m. ET), about a dollar below Monday's peak of $92.58, the highest intraday price since early October 2008. ICE Brent was unchanged at $94.84, having topped $96 on Monday for the first time since 2008. "Oil sentiment has turned decidedly bullish, partly driven by unusually cold weather, but more due to an increasingly optimistic consensus view on 2011 economic performance, especially for the U.S.," JPMorgan analysts led by Lawrence Eagles said. Prices rallied on Monday, stoked by ...

(Reuters) - U.S. crude approached a three-week high near $76 after a leak forced Enbridge to shut down the biggest pipeline supplying Canadian oil to refineries in the Midwest and to a key storage hub in Oklahoma. Enbridge Inc closed its 670,000 barrel per day (bpd) Line 6A, the largest of the company's major three, after a leak was discovered near Romeoville, Illinois. The duct accounts for between 7-8 percent of total U.S. crude imports. Front-month U.S. crude for delivery in October rose $1.18, or 1.6 percent, to $75.43 a barrel at 0701 GMT, after touching $75.96 on Thursday, the highest intraday price since August 19. The November contract added 64 cents to $76.43. Contracts further out were little changed or fell after a Thursday government report showed total U.S. petroleum ...

(Reuters) - Oil was steady near $74 on Thursday as investors turned their attention to upcoming U.S. employment reports, following gains of almost 3 percent a day earlier after positive manufacturing data lifted spirits across markets. U.S. crude for October delivery slipped 8 cents to $73.83 a barrel by 0704 GMT (3:04 a.m. EDT), after a jump of $1.99 on Wednesday. ICE Brent dipped 33 cents to $76.02. Manufacturing in top oil consumers the United States and China accelerated in August, reports showed on Wednesday, raising hopes record petroleum stockpiles would fall and reviving confidence across markets. The focus over the next two days was set to turn to lagging U.S. employment indicators, including weekly jobless claims, on Thursday. The nation's nonfarm payrolls probably fell for a ...

(Reuters) - U.S. crude oil fell below $86 a barrel on Tuesday, dampened by a stronger dollar and an expected rise in U.S. crude and fuel stocks. The dollar reached an eight-and-a-half month high against the yen and a one-year peak versus the euro after robust data that suggested the Federal Reserve will lead its counterparts in Europe and Japan in raising interest rates this year. The move brought oil down from 19-month highs hit on Monday, and pressured other commodities such as gold . U.S. crude for June fell 98 cents to $85.21 by 0927 GMT, after hitting an intraday high of $87.15 on Monday, the strongest front-month price since $89.82 traded on October 9, 2008. London Brent crude slipped 79 cents to $88.15 a barrel, maintaining a big premium over U.S. crude futures, ...