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April WTI Crude Futures Plunge To $46 Handle As Contango Soars

Tyler Durden's picture




 

Front-month crude oil futures just plunged to new 6-week lows and a $46 handle. The April-May (J-K) spread has soared... no immediate catalyst for this move so we suspect it is Oil ETF and futures-roll-driven flow.

 

WTI hit 6-week lows...

 

And contango is soaring...

 

 

Charts: Bloomberg

 

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Thu, 03/12/2015 - 14:14 | 5882323 Carpenter1
Carpenter1's picture

Oil to $200!!

 

Lots of broke ass bulls, serves them right.

Thu, 03/12/2015 - 14:30 | 5882413 Id fight Gandhi
Id fight Gandhi's picture

Didn't you hear, low oil prices mean good for the eCONomy and people will have more money to buy shit they don't need.

Thu, 03/12/2015 - 14:33 | 5882419 max2205
max2205's picture

Thanks for the buy signal Tyler  good for 1% so far

Thu, 03/12/2015 - 14:37 | 5882433 Carpenter1
Carpenter1's picture

Did it make up for your 8% loss? Oh, right, you weren't long until oil hit $46.90, you nailed the bottom perfectly. Bulls really butt hurt right now. 30 mins of objective research would've prevented your losses.

Thu, 03/12/2015 - 18:21 | 5883322 stocktivity
stocktivity's picture

I love that word "contango".  Somehow I can envision a bunch of oil ministers dancing around but instead of flowers in their mouths, they have guns in their mouths.

Thu, 03/12/2015 - 14:35 | 5882427 KnuckleDragger-X
KnuckleDragger-X's picture

The monkeys are throwing darts and making guesses. At this point nobody really know's what's going to happen but it's great fun guessing and ignore that iceberg off the port bow....

Thu, 03/12/2015 - 15:08 | 5882565 HardlyZero
HardlyZero's picture

It's fun to watch but not be directly involved, in my shorts.

Thu, 03/12/2015 - 15:44 | 5882700 ceilidh_trail
ceilidh_trail's picture

^Peckerwood1 knows!^

Thu, 03/12/2015 - 14:17 | 5882344 ShrNfr
ShrNfr's picture

Trying to roll futures in the market will do that to ya. Expect it to be bad for that reason for the next several days.

Thu, 03/12/2015 - 14:22 | 5882369 44MagnumPrepper
44MagnumPrepper's picture

War is coming.  ALL HAIL CHUMBA

Thu, 03/12/2015 - 14:59 | 5882511 JuliaS
JuliaS's picture

$33/barrel and we'll be able to wage 3 wars (Russia, Iran, Syria) for the price of one $100 war.

Call it a "blowout" sale.

Thu, 03/12/2015 - 14:22 | 5882370 unrulian
unrulian's picture

Still paying $1.20/litre for diesel here...Bastards   ($4.54/ gallon) (Canuckistan)

Thu, 03/12/2015 - 20:52 | 5883747 sun tzu
sun tzu's picture

$3 of that is taxes?

Thu, 03/12/2015 - 14:23 | 5882374 venturen
venturen's picture

wouldn't want to be hanging onto a couple million barrels waiting for it go to $100...would be getting nervous at $60....OUCH $46? 

Read a silly article today how the oil companies are killing it....even though the oil they normal sell for $100 is at $46 they are killing it trading....with the price at $46. Anyone want to explain how when your selling price is normal $100....you replacing that profit by being a  a trader at $46? Only in the finanical press could someone sell that BS....these puppies are hurting and by projections of productions they are going to hurting a lot more! BRING THE PAIN!!!

Thu, 03/12/2015 - 14:36 | 5882428 max2205
max2205's picture

Too bad gasoline won't drop.  Gas was almost cheaper than bottled water for a moment 

Thu, 03/12/2015 - 14:24 | 5882382 ZoroAustrian
ZoroAustrian's picture

Every price movement has a game-theory financial-engineering explanation while real supply and demand take a distant back seat.  How's that for price discovery?

Thu, 03/12/2015 - 14:28 | 5882396 NoDebt
NoDebt's picture

Contango:  A situation in the oil pricing market that makes oil producers continue to pump like crazy and put it in storage because even though it's worth nothing today, it'll be worth a mint tomorrow.  Promise.

Thu, 03/12/2015 - 14:29 | 5882403 wmbz
wmbz's picture

According to eveyones favorite finance guru, J. Kramer these lower prices are hitting a home run for oil companies! It costs lesss to add additional rigs now, etc...

So he sez...Buy oil company stocks! It's just that simple...See?

Thu, 03/12/2015 - 14:37 | 5882434 hungrydweller
hungrydweller's picture

Bring it on!  $30 oil here we come!

Thu, 03/12/2015 - 14:46 | 5882461 Fun Facts
Fun Facts's picture

If storage fills up, contango will get even bigger until the futures calendar spread equals the cost of storage and insurance in a tanker.

Thu, 03/12/2015 - 15:11 | 5882574 HardlyZero
HardlyZero's picture

As the price comes down there will be higher supplier pumped volumes to make up for the losses...could get exponential volume upside...until the capacity caps out, then price will collapse double quick.

Thu, 03/12/2015 - 15:01 | 5882526 element115
element115's picture

I call bullshit.

Yahoo had an article two hours ago saying contago fears had eased as there were only 5 supertankers holding their cargo for a higher price...

????

Thu, 03/12/2015 - 15:23 | 5882622 The Shape
The Shape's picture

There's so much bullshit out there on storage, contago and rig counts. One jerk says one thing and another jerk says something totally different.

Clearly in real time no one knows shit and we'll find out who was on the money in about 6 months when we're looking back.

In the meantime bullshit still moves the market.

Thu, 03/12/2015 - 15:35 | 5882661 ali-ali-al-qomfri
ali-ali-al-qomfri's picture

Last Contango in Paris, Texas

Thu, 03/12/2015 - 15:46 | 5882711 stant
stant's picture

Bring back the big block engines with two carbs.

Thu, 03/12/2015 - 16:05 | 5882778 mt paul
mt paul's picture

holly double pumpers...

Thu, 03/12/2015 - 16:54 | 5882975 Burls
Burls's picture

Traders can't get away from those April WTI futures fast enough.

No one wants to actually take delivery of the stuff.

It will be a game of HOT POTATO until the expiry date next Friday.

I wouldn't want to be the one stuck with it.

Thu, 03/12/2015 - 19:24 | 5883505 Chad_the_short_...
Chad_the_short_seller's picture

ummm....... short WLL at will.

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