Crude oil prices retreated yesterday in a mirror image of Friday's dramatic rally. While further distruptions to Azeri crude supplies remains the number one topic on trading floors, a recent report from consultancy Petrologistics highlighted that Opec's current production is almost 1m barrels per day higher than it's actual target. While this data is bearish in the short-term, it provides increased fodder for those Opec nations looking to have production levels decreased at the organization's upcoming meeting on September 9th.
Consumer hedgers were given a reprieve on Friday as October crude oil settled below $115 just one day after breaking $122. Once again, the opportunity to lock in a price ceiling of $120 for zero premium for 2009 has presented itself. By selling every $112 put in the same tenour, it is possible to have a price floor and price ceiling between $112 and $120 for the entire 2009 calendar year.
Sunday, August 24, 2008
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