Etfs Brent Discussion Threads

[thewealthofsocrates] 01/7/2020 13:43

hxxps://www.tradingview.com/chart/UKOIL/r22xQaYj-OIL-Buy-after-retest-and-false-break-down/

[spob] 03/4/2020 00:55

Oil surges as Trump spurs hopes for Russia-Saudi pact

Brent rises nearly 50% at one point as US president says he expects deal to cut production

Some market analysts have said the oil demand collapse is so severe, amid global lockdowns and travel bans, that any supply cuts from major producers would have a limited impact



Anjli Raval in London and Henry Foy in Moscow yesterday


Oil soared nearly 50 per cent in its biggest ever one-day rally after US President Donald Trump stoked hopes of a supply cut deal led by Saudi Arabia and Russia to alleviate a price collapse triggered by the coronavirus outbreak.

Mr Trump on Thursday said Crown Prince Mohammed bin Salman of Saudi Arabia and Russian President Vladimir Putin had begun talks on how to curb production by as much as 15m barrels a day — a large chunk of the world’s oil demand, which stood at 100m b/d last year.

“I expect & hope that they will be cutting back approximately 10 Million Barrels, and maybe substantially more which, if it happens, will be GREAT for the oil & gas industry!” he said. “Could be as high as 15 Million Barrels. Good (GREAT) news for everyone!”

Almost immediately after Mr Trump’s tweet, Saudi Arabia’s state news agency said the kingdom was calling for an emergency meeting of Opec and other oil producer nations, including Russia. It said it sought to reach a “fair” supply deal, without committing to any cuts.

However, the Kremlin rejected Mr Trump’s remarks. “There was no conversation” between Mr Putin and Prince Mohammed, Dmitry Peskov, Mr Putin’s spokesman said, adding that none was planned.

“So far, no one has started talking about any specific or even abstract deals in exchange for Opec+," he said, referring to the three-year oil alliance between Opec and Russia that collapsed last month.

One Opec official said the tweet from the US president amounted to “Trump talking before his brain engages”.

On Wednesday Mr Trump said he believed a deal to end a price war — which has taken Brent to its lowest level since 2002 — was imminent, sparking a rally in crude prices.

Brent crude, the international oil benchmark, rose as high as $36.29 a barrel after Mr Trump’s tweet, a record intraday jump in percentage terms amounting to nearly 47 per cent. It settled $5.20 higher, a 21 per cent gain, at $29.94 a barrel
Bar chart of Brent crude, biggest one-day rises, % showing Oil has historic jump on hopes for Russia-Saudi Arabia pact

People close to the kingdom say the world’s biggest oil exporter still wants a deal on supply cuts, but any curbs would need to be shared between all major producers. Saudi Arabia, Russia and the US together account for around a third of global oil production.

Helima Croft at RBC Capital Markets said: “There is a realisation in Washington that the path to a deal runs through Moscow. Everyone knows that Saudi Arabia wants Russia at the table but there is also a recognition that the US will have to participate in some way. But there are clear questions about what the US’s involvement will look like.”

Riyadh had pushed for a deal to deepen and prolong production curbs ahead of a March meeting of oil ministers, but it was met with reluctance from Moscow. This prompted Saudi Arabia to pursue a “pump at will” strategy to shock the market, dramatically cutting prices for its crude and raising production to a record 12m barrels a day.

The flood of supplies are set to hit the market as the global oil industry faces its biggest consumption hit in history, with the coronavirus pandemic forcing lockdowns and travel bans. Traders are forecasting that crude demand could fall by as much as 30m b/d in April.

Some market analysts have said the demand collapse is so severe that any supply cuts from major producers would have a limited impact. Global storage tanks are already filling up and producer companies could be forced to shut-in oil projects.

The US has put pressure on Saudi Arabia to scale back its supply surge, which has contributed to a price collapse and ricocheted across the shale industry, where many companies are on the brink of bankruptcy.

While Saudi Arabia and Russia have said they backed joint efforts, until now there has been little sign of a strategy shift. Saudi Arabia has told the state energy company to prepare for a prolonged fight. Saudi Aramco has informed oilfield services contractors to be ready to provide support as it seeks to keep production at heightened levels.
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Russian energy minister Alexander Novak said on Thursday he did not “exclude the option of negotiations” with Saudi Arabia, but that the collapse in demand meant that cuts to supply would not necessarily prevent further oil price falls.

Complicating potential talks brokered by Mr Trump, Russia’s decision to abandon its alliance with Saudi Arabia was aimed partly at hurting US shale companies and the broader US economy. Washington has targeted the Russian energy industry through sanctions since 2014 in response to Moscow’s invasion of Crimea.

“The political hurdles to any supply deal are as large as the balance problem itself,” said analysts at JBC Energy.

Additional reporting by Derek Brower and David Sheppard

[spob] 30/3/2020 16:56

12 month high 34.1 (early Jan)


close 12.8

low 12.5 (-63.3%)

[bountyhunter] 03/5/2019 16:19

Has OPEC Reached Its Real Output Cut Goals?
By Irina Slav - May 02, 2019, 4:00 PM CDT

[cashflo] 15/1/2019 21:35

Notice here from the charts oil dropped - oilb didn't mirror all of the drop and the £/$ stayed relatively the same.

[cashflo] 11/1/2019 10:26

Out of these now for a healthy little profit.
Guessing it will drop back.

Cant understand how two weeks ago if you looked at the consensus oil was about to be obsolete and destined to go to $1 a barrel and suddenly here we are after a ferocious rally.

Seriously though how many long stops were taken out after the $60 support was breached? a lot I would imagine.

[cashflo] 08/1/2019 21:31

Cheers steve.

Been there with with Bp and a couple of others rdsb etc. The oil co's just don't track oil itself well enough for me - I know they're not meant to.

I can see oil (in my opinion dyor etc) back up to 65/70 a barrel in the meantime BP could be £4 or £5 or £6 or somewhere in between.

Been there with the small caps - buy five explorers usually 1 will bomb within a year 2 will be losing and 1 or 2 may rise.

[steve73] 08/1/2019 14:11

Just buy some oil co. shares... BP, Shell tend to track O/P (and pay good dividends while you wait), although as BP discovered accidents can happen.
Other small producers; PMO, ENQ, TLW, etc. usually track a multiple of the same, albeit with more risk.
Keep away from explorers though, unless you're feeling lucky.

Up to you how risky you want to make it...

[cashflo] 08/1/2019 13:51

cheers steve.
I'm long from back in dec thinking 26 was the support - the position is now a few quid under but looking reasonable to me with a target of 30. Plus there the $/£ level aswell which obviously affects this.

But back to the point of OILB - it has enabled me to be in on oil without the stress of spreadbetting.

Eventually I guess oilb will be worth 0 with contango etc

any other long term ways to speculate on oil?

[steve73] 03/1/2019 05:33

cashflo..

When this was set up initially it tracked exactly (for the first month anyway)... After that as each month's contract expires, and any holding roll over to the next month, then there is a "cost" which results in this "ETF" deviating from the actual oil contract value.

At least this is how I understand it to be.. It think the overall cost is less than 1/2% each month, but by now (over 18 years) these costs have compounded up to make this less than half the actual value of Brent.

It's an easy way to buy oil contracts, in smaller lots than buying contracts directly, albeit probably a little more expensive.

[cashflo] 02/1/2019 17:17

well what ever it is doing I'm glad it is up

[cashflo] 27/12/2018 11:45

This just doesn't seem to be tracking oil very well?

[cashflo] 25/11/2018 20:20

any one diving in to this here?

[philo124] 01/11/2016 16:58

Closed yesterday at small profit.Phew!

[spob] 08/3/2016 13:45

Trend-following hedge fund strategies lead performance in 2016


Mary Childs and Stephen Foley in New York and Dan McCrum in London


FT

8 March 2016



Computer-driven hedge funds renowned for “trend-following” are beating their highly paid human counterparts so far this year after struggling to make money in four of the past five years.

Now as stock markets and commodity prices continue rebounding this month, the question is whether these funds, often known as commodity trading advisers, or CTAs due to their legal set-up, can still prosper.



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Such “systematic221; funds, which surf trends using financial models and algorithms, do well whenever there is a clear direction for markets. Down markets are as good as uptrends, so long as they are clear, and in January and most of February, financial uncertainty proved profitable.

Lists of the best-performing funds were dominated by trend followers and quantitative specialists.

As of February 17, CTA funds were up 7 per cent but the gain for the year now looks like a more modest 5.4 per cent, according to Société; Générale.

Troy Gayeski, partner at the fund of hedge funds SkyBridge Capital, says investors have been burnt before by chasing returns in CTAs but that “this time it is different”.

“Typically, their peak amount of capital is after the peak of their performance. But the capital they are attracting now — which is a modest amount relative to the size of the hedge fund industry — is capital that is looking ahead,” he says.

The enthusiasm for CTAs comes amid the struggles of hedge funds that invest on the basis of fundamental analysis and insight.

Many hedge funds are sold on the basis the investment profits they will produce for clients will not be correlated to the performance of regular investment portfolios.

The argument reflects the legacy of the 2008 financial crisis, when many markets crashed in unison and the average hedge fund fared no better than holding a common mix of stocks and bonds.
Chart: Trend-following funds

According to data provider HFR, the typical hedge fund lost 3 per cent of its investors’ money in January and February. A narrower HFR index of quantitative and CTA funds showed gains of more than 5 per cent over the same period.

Assets dedicated to systematic macro strategies ballooned in the aftermath of the crisis, doubling to $188bn in 2011, HFR data show. They peaked at $270bn in 2014, before dipping slightly this year.

Prime Brokers, the arms of investment banks that help hedge funds trade and find capital, report growing interest in CTAs from the pension funds and sovereign wealth funds which entrust money to hedge fund managers.

“In the beginning part of the year, the assets have gone up,” says James Skeggs, head of alternative investments consulting at SocGen prime services. “I would expect that CTA assets are increasing due to performance, but also asset inflows.”
Chart: Trend-following assets

Of course, while the unifying aspect of CTAs reflects a reliance on computer programs to predict trends, their aims and performance can vary dramatically.

A Schroders fund that tracks the flagship fund at Leda Braga’s Systematica, which oversees $10.2bn, returned 9.9 per cent through the end of February, fuelled by bets on fixed income and against energy and equities, according to a person with direct knowledge.

Cantab Capital’s main $2.7bn Quantitative Fund has gained 14.4 per cent to the end of February, according to people familiar with the matter, after losing 8.2 per cent in 2015.

Ewan Kirk, chief investment officer for Cantab Capital, said “while there is no such thing as a ‘typical’; systematic manager, many managers in our space have been short energies and long bonds since the beginning of the year”.

The performance of some funds are remarkable in a low return world. The Conquest Macro Fund has handed investors gains of almost 26 per cent through February 26 and Progressive Capital Partners’ Tulip Trend Fund 24 per cent, according to people familiar with the figures.

Whether good CTA performance can continue as market sentiment shifts and crucial central bank meetings loom large in the coming weeks starting with the European Central Bank on Thursday, shapes as a major test for the sector and investors.

“If you believe we are going to have a bear market, CTAs will have a chance to make money in that environment, and in the meanwhile they offer non-correlated returns,” says Mr Gayeski.

The danger with following a trend comes from herding, as additional sellers can add weight to a falling market.

Should it turn, the need for those sellers to switch around and start buying can be like removing the weight from a spring: it rebounds violently.

Nikolaos Panigirtzoglou, strategist at JPMorgan, points to the ongoing large short position held by such funds in S&P 500 futures, which provide a straightforward way to bet against the market.

The stock market, however, has staged a notable recovery over the past month, while prices for oil and metals such as copper and iron ore have surged sharply higher.

“The pain trade is to be short right now,” adds Mr Panigirtzoglou. “Some of these guys who are short will be forced to capitulate.”

This article has been updated with a more recent figure for return on Cantab Capital’s main Quantitative Fund

[spob] 05/3/2016 13:12

Commodity prices signal market bottom


Neil Hume and David Sheppard

FT

4 March 2016


When news of the highest crude stocks since the Great Depression hit oil traders’ screens on Wednesday, those expecting another rush of sell orders were in for a surprise.

After a momentary wobble, oil prices started to climb as the weekly report from the US Department of Energy was brushed aside by investors who are increasingly prepared to bet the worst of a 20-month long price rout is over.


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If their instincts are correct — and it remains a big if — it could mark a turning point in a vicious downturn that has shredded the budgets of producing countries, upended central bank policies and stoked fears of a deflationary spiral.

While the oil market remains weighed down by oversupply, for the first time in almost a year some big traders are prepared to look beyond a glut that sent prices spiralling below $30 a barrel in January.

“If you presume we have enough storage space for all the excess crude in the world then it is probable we have hit the bottom,” says Jonathan Whitehead, global head of commodities at Société; Générale in London.

“When the oil price went below $30 a barrel, it started to feel like the market had gone too far,” he says. Prices that low threatened to quickly make large swaths of future oil production unviable, he adds.

Since hitting a 12-year low near $27 a barrel in January, Brent crude oil, the international benchmark, has rallied by more than third to near $37 a barrel, even as it remains well below the $100 level it traded near for most of 2010 to 2014 period.

Shares of oil majors BP, ExxonMobil, Royal Dutch Shell and Chevron have risen between 10 and 30 per cent since late January.

Part of the reason for oil’s nascent recovery is Saudi Arabia, the world’s largest exporter, has arguably done enough to convince the market that it is sufficiently concerned about the length and depth of the price rout to consider action.

Though sticking to its policy of not cutting output, the kingdom has nevertheless agreed to the idea of a production freeze with other big producers such as Russia. Up to 15 countries are expected to meet in Russia in late March.
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Equally, the US shale industry that contributed so much to the glut is finally showing real signs of slowing down. US crude oil production jumped from 5.4m barrels a day in April 2010 to 9.7m b/d in April 2015, according to the US Energy Information Administration, but in December it registered the first significant year-on-year declines in almost eight years.

“The pace of decline in the US oil and gas industry has accelerated in 2016,” said Paul Horsnell, commodities analyst at Standard Chartered. “US output is falling and is set to fall further over an extended period.”

Steadier oil prices have also helped stem broad-based commodity selling due to the linkage that comes through oil-dominated commodity indices and exchange traded funds.

Iron ore, the steelmaking ingredient, has rebounded 20 per cent this year to more than $50 a tonne, catching many analysts and even some producers on the hop.

Industrial metals such as copper, zinc and aluminium have risen to their highest levels since the autumn, triggering a big rally in beaten-down mining stocks. Anglo American and Glencore, the worst-performing stocks on the FTSE 100 last year, have rallied by 86 per cent and 66 per cent respectively so far in 2016.

Recent announcements from China, the world’s largest consumer of commodities, that it will continue to support economic growth, have helped support prices. Supply cuts have also tightened some markets, such as zinc.
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Ivan Glasenberg, the chief executive of Glencore, argues that fears about a slowdown in China, which consumes about 40 per cent of the world’s copper, are overdone. “Our order book and our sales into China and around the world at the moment is pretty good. We had very good orders in the last quarter of 2015 and we continue to see good orders into China whether you are talking zinc, copper, nickel or coal,” he adds.

While most commodity prices may have stabilised, some remain under pressure.

US natural gas prices have dropped to $1.61 per million British thermal units -- the lowest since 1995 -- as a warm winter have left 2.5tn cu ft of gas in storage, a massive amount this late in the heating season. A sharp decline in drilling rigs has done little to curtail shale gas production.

The US Department of Agriculture, in an outlook published last week, forecast lower prices for wheat, corn, soyabeans and cotton in the coming year, citing high stocks and increased exports from Brazil and Ukraine.

Analysts say investors should also be cautious about the prospect of a significant rebound.

Many oil companies, in particular, have been shaken by the collapse and are likely to respond to any uptick in prices by hedging the moment they think prices are high enough to cover operating costs and service their debt.
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“The upside at this point is not a huge amount,” says Mr Whitehead. “If the price rallies by more than a few dollars we’re going to see US shale producers come into hedge very quickly.”

Investment bank Macquarie says the rally in oil looks premature and prices could slip back towards $30 a barrel. Hedge funds have established their biggest bet in history on a recovery in Brent, but may start to sell again if a more sustainable rally does not materialise.

A sustained recovery in commodity prices, say analysts, would need a pick-up in global economic growth and demand, particularly in China.

“Have we bottomed? I think so but I don’t want to sit here and predict commodity prices over the next few months,” says Mr Glasenberg. “A lot depends on China. We all have to wait and see.”

Additional reporting by Gregory Meyer

[spob] 22/1/2016 09:28

Bought some OILB today

OILB - 15.75 mid


Barc price 11.15

Sterling 1.4275

Brent crude 30.9

Nymex 30.94

[philo124] 07/1/2016 15:05

Difficult say due to contango.

[garethcoulson] 07/1/2016 12:32

If you purchased say £1000 of these now and then oil goes back up to $70 - $100 what does anyone reckon that £1000 would be worth ??

[philo124] 06/1/2016 10:28

Added to my losses. See Nostradamus 2016 prophecy.

[philo124] 09/8/2015 21:24

Is this an aim stock?

[philo124] 07/7/2015 08:52

Bought this a.m.