What is our trading focus?
OILUKJUN20 – Brent Crude Oil
OILUSJUN20 – WTI Crude Oil
CLM0-N0 - WTI June-July Spread
XOP:arcx – Oil & Gas Exploration & Production
XLE:arcx – Energy Select Sector SPDR Fund (Large-cap US energy stocks)
Crude oil continues to trade lower this Monday with the headline grabber being the near 20% collapse overnight in the soon-to-expire May contract (CLK0). Most active traders have by now moved on to focus on the June contract (CLM0) which is the most active now, both in terms of traded volume and open interest.
The expiring contract is now mostly in the hands of physical oil traders and the behavior of the contract confirms what we already feared: That the U.S. is running out of storage at Cushing, Oklahoma, the delivery hub for WTI crude oil futures traded in New York. The weekly stock report from the Energy information Administration shows how the Covid-19 related lock downs in the U.S. has temporarily killed demand for gasoline. Last week’s report found record levels of gasoline while implied demand had dropped to a record low (since 1992).