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"Darren Woods is mounting a strong defense of his plan to rescue Exxon Mobil Corp. from its share-price slump with $200 billion of investment over seven years that’s at odds with the belt-tightening undertaken by rivals.
Woods’ solution, outlined in a Wednesday interview, is to invest heavily in mega-projects that he says are so low cost they’ll dominate oil and natural gas markets for decades to come."
I think this is a sensible call and one that we'll see a lot of major players start doing (if they haven't already) as the market dismisses the 'lower for longer' rhetoric and starts looking back towards the $100 mark as we continue the over/under supply cycles in Oil.
Trading: Primarily Energy but also a little Equities, Fixed Income, Metals and Crypto.
Frequency: Many times daily
Duration: Never
Posts: 5,049 since Dec 2013
Thanks Given: 4,388
Thanks Received: 10,207
The Baker Hughes rig count report shows U.S. oil rig count increased by 15 in the latest week to 859.
This is the highest level in over 3 years.
It's +112 since year end.
It's +543 since the May'16 low of 316.
I was standing on top of one of our tanks the other day and saw three or four up where there had been none. Made me wonder how the determine a new "rig". Is it when the start rigging up or is it when the start drilling or only at completion?
Reading your posts on trading crude oil curve anomalies is very interesting. I looked up Curve Advisor......$799 a month for a basic subscription??? They must be VERY proud of their product! But there is a 25% off coupon.
To be counted as active a rig must be on location and be drilling or 'turning to the right'. A rig is considered active from the moment the well is "spudded" until it reaches target depth or "TD". Rigs that are in transit from one location to another, rigging up or being used in non-drilling activities such as workovers, completions or production testing, are NOT counted as active.
Just to be clear, Curve Advisor is a Eurodollar newsletter and not crude. I get the free - several weeks delayed version - and do not pay the subscription. It's interesting to see how he thinks about the eurodollar curve but to be honest it hasn't given me any new ideas for crude. There's just to much 'interest rate speak' in there that i do not understand for it to be really valuable. I do dabble in Eurodollars, and have been mildly successful (up last year, and this year), mostly looking for mean reversion of double flys. In reality though I'm not sure it's worth the effort (small profits for commission heavy multi leg trades), or whether it's just all newbee luck! If it wasn't for the fact that I'm sat here all day watching screens I wouldn't be doing it.
Thanks. That's awesome to know. Working in the energy industry it's interesting for me to know what moves the prices of the products we move and store.
In my reading through this tread I see that the smart trades seem some type spread or combination of spreads. One of my stead fast rules(after losing tons of money, a lot of it on a gas crack) is to never enter a trade without a stop in place. Is it possible to do this with a spread given that there are at least to moving parts?
Trading: Primarily Energy but also a little Equities, Fixed Income, Metals and Crypto.
Frequency: Many times daily
Duration: Never
Posts: 5,049 since Dec 2013
Thanks Given: 4,388
Thanks Received: 10,207
There are exchange listed spreads for most time spreads but there are also now exchange listed spreads for most of the cracks against both WTI & Brent, and of course for WTI-Brent itself. So if you have access to these spreads it's technically possible to enter stop orders. The problem is some of these spreads have little liquidity. For example 9:04 Central 21-Jun the HOCL-X8 (Nov18 Heating Oil Crack) spread is 24.19/24.24 vs a settlement of 24.77 with NO trades. Hence if you had a 24.50 stop it wouldn't have triggered yet, even though the market is 30c through it!
Ouch. I think what I may do is place the stop on one leg where the setup is and force myself to exit the other side if its hit. This will require me to sit at this computer(As if I don't do that already). But mental stops have never been my strength. Someone else told me it might be possible to place a conditional order to exit the other side if the first side is hit but that would be dependent on the broker and platform. The idea of using options was also a possibility.
I like the idea of trading spreads but as with all trading tools they have to be used correctly. Now to find out what CORRECTLY is. Thanks SMCJB.
I have a question on this blazing hot Texas afternoon. I want to look at trading crude oil spreads due to liquidity and as @SMCJB pointed out the notional values of the contracts are the same so it wouldn't be unbalanced. My question is I'm undertaking the process of learning to code. The reason is data analysis to start. If you could only choose to learn one language for this( at 42 I'm not the youngest guy) which one would it be? I'm considering R or Python. I know a little C#. Thank you for the input and advice.
