Saudi Ministry of Education to showcase innovations at 2025 Geneva International Exhibition    7,523 violators of residency, labor, and border security laws deported in a week    Video contradicts Israeli army account of deadly March 23 strike on Gaza paramedics    Saudi Arabia spends over $241 million to implement de-mining projects in 3 countries    Italy's Meloni government approves controversial security decree expanding police protections and penalties    Egypt submits new Gaza ceasefire and prisoner exchange proposal: Report    'Everything is possible' — Ronaldo focused on titles, not 1,000-goal milestone after Riyadh Derby win    Saudi, US military leaders discuss enhanced defense cooperation in Riyadh    King Salman Global Academy for Arabic Language launches program with Indiana University    Ronaldo brace powers Al Nassr past Al Hilal in Riyadh derby thriller    Ed Sheeran weaves Persian music into new song, Azizam    Al-Jadaan: Crown Prince's directives confirm government's ability to bring back balance to real estate market    Veteran Bollywood actor Manoj Kumar dies at 87    Foreign investors are allowed to engage in real estate business outside Makkah and Madinah Commercial speculation should not be the purpose of real estate transaction    Aubameyang fires Al Qadsiah into King's Cup final with stoppage-time winner over Al Raed    Musk's X is suing India, as Tesla and Starlink plan entry    Tesla sales plunge after backlash against Elon Musk    Danilo Pereira fires Al Ittihad into King's Cup final with dramatic stoppage-time double    Screen time in bed linked to insomnia, study finds    Mexico bans junk food in schools to fight childhood obesity epidemic    Sweet sales surge ahead of Eid as Saudi chocolate imports top 123 million kg in 2024    Bollywood actress vindicated over boyfriend's death after media hounding    Grand Mufti rules against posting prayers and preaching in mosques on social media    King Salman prays for peace and stability for Palestinians in Ramadan message King reaffirms Saudi Arabia's commitment to serving the Two Holy Mosques and pilgrims    Exotic Taif Roses Simulation Performed at Taif Rose Festival    Asian shares mixed Tuesday    Weather Forecast for Tuesday    Saudi Tourism Authority Participates in Arabian Travel Market Exhibition in Dubai    Minister of Industry Announces 50 Investment Opportunities Worth over SAR 96 Billion in Machinery, Equipment Sector    HRH Crown Prince Offers Condolences to Crown Prince of Kuwait on Death of Sheikh Fawaz Salman Abdullah Al-Ali Al-Malek Al-Sabah    HRH Crown Prince Congratulates Santiago Peña on Winning Presidential Election in Paraguay    SDAIA Launches 1st Phase of 'Elevate Program' to Train 1,000 Women on Data, AI    41 Saudi Citizens and 171 Others from Brotherly and Friendly Countries Arrive in Saudi Arabia from Sudan    Saudi Arabia Hosts 1st Meeting of Arab Authorities Controlling Medicines    General Directorate of Narcotics Control Foils Attempt to Smuggle over 5 Million Amphetamine Pills    NAVI Javelins Crowned as Champions of Women's Counter-Strike: Global Offensive (CS:GO) Competitions    Saudi Karate Team Wins Four Medals in World Youth League Championship    Third Edition of FIFA Forward Program Kicks off in Riyadh    Evacuated from Sudan, 187 Nationals from Several Countries Arrive in Jeddah    SPA Documents Thajjud Prayer at Prophet's Mosque in Madinah    SFDA Recommends to Test Blood Sugar at Home Two or Three Hours after Meals    SFDA Offers Various Recommendations for Safe Food Frying    SFDA Provides Five Tips for Using Home Blood Pressure Monitor    SFDA: Instant Soup Contains Large Amounts of Salt    Mawani: New shipping service to connect Jubail Commercial Port to 11 global ports    Custodian of the Two Holy Mosques Delivers Speech to Pilgrims, Citizens, Residents and Muslims around the World    Sheikh Al-Issa in Arafah's Sermon: Allaah Blessed You by Making It Easy for You to Carry out This Obligation. Thus, Ensure Following the Guidance of Your Prophet    Custodian of the Two Holy Mosques addresses citizens and all Muslims on the occasion of the Holy month of Ramadan    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



One trader holds 11% of NYMEX contracts
Published in The Saudi Gazette on 23 - 08 - 2008

A single energy conglomerate held 11 percent of all contracts on the New York Mercantile Exchange at one point last month, according to a published report Thursday, suggesting that speculators may have played a larger part in volatile oil markets than once thought.
The Commodity Futures Trading Commission made an unusual request last month for data from Vitol Group, a private Swiss energy company that regulators thought was helping industrial firms get the oil they needed, according to The Washington Post.
The commission discovered, however, that the Vitol would be better described as a speculator, trading oil contracts to turn profits rather than assisting companies that actually needed oil delivered for their operations.
The report comes one month after the Interagency Task Force on Commodity Markets, chaired by the commission, released an interim report saying record oil prices were the result of “fundamental supply and demand factors.” “It is now evident that speculators in the energy futures markets play a much larger role than previously thought, and it is now even harder to accept the agency's laughable assertion that excessive speculation has not contributed to rising energy prices,” said Rep. John Dingell, a Michigan Democrat.
Dingell told the Post it was “difficult to comprehend how the CFTC would allow a trader” to acquire such a large oil inventory “and not scrutinize this position any sooner.” A number of lawmakers have blamed speculators for the spike in oil prices and last week, four Democratic senators asked for an investigation into the commission's report, which they said was based on flawed information.
The commission never named Vitol. The Wall Street Journal identified the company in a report Wednesday which cited unidentified people familiar with the matter. The Post cited two anonymous sources that it said had direct knowledge of the commission's request in their report.
The commission investigation showed Vitol was one of the most active traders of oil on Nymex as prices reached record levels.
By June 6, Vitol had amassed contracts equal to 57.7 million barrels of oil, about three times the amount the United States consumes daily. On that day, the price for a barrel of oil spiked $11 to settle at $138.54, per barrel, valuing Vitol's oil holding at nearly $8 billion.
Commission documents do not show how much Vitol had put down to acquire that many contracts. Nymex allows traders to acquire contracts by putting up margins, which can amount to a fraction of the actual worth.
So-called “swap dealers” operate in oil markets by investing on behalf of hedge funds and wealthy individuals who have no plans to take delivery, or buy an actual contract for oil.
The commission's data show that at the end of July, just four swap dealers held one-third of all Nymex oil contracts that bet prices would increase.
Last month, the commission reclassified a huge oil trader as a noncommercial speculator. Industry analysts immediately began to rethink what might be moving oil prices. Commodities traders rely on weekly reports from the commission that classifies market players as commercial or speculative, without releasing names.


Clic here to read the story from its source.