/biz/ - Business & Finance

Oil Barons, WW@

OilBro here. What happens if OPEC decides to rape the price of oil?

Namefags kys, this is an Oil thread now

It feels good to be oilpilled

>>961582
You are being anal. Like an electricity trader.

>>961681
People will quit traveling to Paris and other destinations. Jet fuel will collapse. Jet fuel buyers for the major airlines will pat themselves on the back so hard their company logo buttplugs will fall out.

>>961715
I agree with you based anon. The only thing holding oil prices up are Chinese buyers of Dubai sourced crude oils. They are trying to support their prior "averaged in" prices but their economy is allegedly slanting to the down side.

>>857800
Allow me anon, as I have made some coin doing that in the last year.

Selling "short" is an obligation to deliver a commodity that you don't have at present but you intend to have it at the time of delivery.

The term is nautical and pertains to rope. In the old days when Lloyd's of London was a group of drunk assholes meeting on a park bench to insure vessel cargoes, a sailing ship owner would come to a rope dealer and say, "I need 200,000 feet of a certain grade rope delivered to me in 1 year." The rope dealer would look in his warehouse and see that he had 18 feet of rope available. That was short compared to the length needed. But the rope dealer said "sure" and the deal was struck. Then the rope dealer goes nuts and tells his rope makers and providers to get fucking busy because he had just sold 200,000 ft of rope and he was a bit short in inventory...."

"Long" on the other hand meant that in the same circumstance, and having completed the deal, the rope dealer looked in his ware house and saw 500,000 ft of rope and thank God, he made a sale but he was still "long" 300,000 ft of rope.

I shorted calendar 2015 WTI crude oil in October of 2014 while at a seminar in Stillwater, Oklahoma with a quick phone call to a voice broker. The reason I promised to deliver oil I didn't have ( I was thus "short" like our rope dealer above, only in oil) is that because of the rising dollar I figured oil would fall to $35/bbl like it had several times in years past under the same condition and there would be plenty of oil for me to buy and deliver on the promise I made to sell oil that I didn't have at the time.

Then OPEC and the Saudis did their thing and well, you know the rest.

I have made many mistakes trading oil (and natural gas) in the past but this trade made up for all of those. I will make more mistakes in the future, too, but if I use good risk management it won't hurt so bad given the cushion I have now. As for assets, I am a small fry.