Discussion
Nitro182 said:
What am I missing ? Head to oilprice.com and you will see the price of oil and natural gas is plummeting. Something has to be going on in the background right? And this only has to be a positive.
Recession will lower demand, also strong dollar makes it more expensive in other currencies (including ours), and so price has to come down to maintain demand. Petrol would be 11p/litre cheaper if our £/$ relationship was where it was 3 months ago.
If you’re asking from a trading perspective, it’s a very multi layered situation, as has been mentioned, demand destruction in a recession is the current risk concern and the Democrats releasing from the SPR has dampened down price.
Also the paper to real trading in oil is 28 times, so 1/28th physical oil is traded compared to financial oil trades. Most trading is done on margin so big moves create big moves. Oil price.com is good except I find you have to sort a lot of what they put in. On YouTube there are lots of interviews with active players.
Volatility will be a big issue especially with the macro picture but I am long it but not a large amount, I think the next few months will either do little or be negative but I opened positions in case something unforeseen happened either Russia related or weather
Also China and it’s lockdowns are suppressing demand, to reiterate, I think volatility will be a big part of it, it probably always has been but unless you’re in it you don’t tend to feel it so much
Also the paper to real trading in oil is 28 times, so 1/28th physical oil is traded compared to financial oil trades. Most trading is done on margin so big moves create big moves. Oil price.com is good except I find you have to sort a lot of what they put in. On YouTube there are lots of interviews with active players.
Volatility will be a big issue especially with the macro picture but I am long it but not a large amount, I think the next few months will either do little or be negative but I opened positions in case something unforeseen happened either Russia related or weather
Also China and it’s lockdowns are suppressing demand, to reiterate, I think volatility will be a big part of it, it probably always has been but unless you’re in it you don’t tend to feel it so much
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