AMAZING SIMPLY AMAZING
Lone trader caused 100 dollar price for oil
Fri Jan 4, 11:41 AM ET
NEW YORK (AFP) - A lone trader out to win a little fame made the purchase that took oil prices to the historic 100 dollars a barrel level this week but he lost 600 dollars on the deal, analysts said.
The trader has been named by US and British media as Richard Arens who runs a one man oil brokerage, ABS.
“The magic figure was hit apparently on the back of a single trade, rumoured to be a local intent on fame,” Sucden analysts wrote in a commentary Thursday on the record breaking deal.
Arens offered 100,000 dollars on the New York market on Wednesday for 1,000 barrels of oil, producing the much talked of 100 dollars per barrel which sparked anguish across the financial markets.
He later sold on the contract for slightly below 100 dollars, taking a 600 dollar loss.
“It was just for the form; he wanted to be the first in the world to buy oil at 100 dollars,” said Antoine Heff, an analyst at NewEdge.
The new price record came as a shock to the markets although many had been saying 100 dollars was inevitable at some point given strong demand and supply constraints.
Oil slipped back slightly but hit 100 dollars again on Thursday.
On Friday, profit-taking pushed the price back again, with quotes in late Asian trade of 99.23 dollars for New York’s main contract, light sweet crude for delivery in February.
The initial spike to 100 resulted from “really just one trade which was like a stunt,” but more trades pushed it above 100 dollars again on Thursday, said Victor Shum, of international energy consultancy Purvin and Gertz in Singapore.
“We have eased off from the 100 dollars level primarily because of some profit taking,” Shum said.
Analysts say rising oil demand has outstripped growth in supply. They point to booming Asian economies like China and India and insufficient investment by oil exporters, which has led to a decline in spare production capacity.
Geopolitical tensions and new buying interest from speculative investors like investment funds are also behind the quadrupling in the oil price over the last five years, analysts say.
Wow did you catch the hidden disclaimer, read the last2 lines, now I want you to read the article again and go to the last one I wrote and look at the chart then do a little research and see if you can see the pattern, if not then just keep bending over and taking it..
Rich