Onyx Power and Gas Consulting continues a weekly series providing the Short Term Energy Outlook as of January 10, 2016. This series of news articles should provide a complete insight on the current conditions of the energy…enjoy, check out archives and come back each week for additional information on how all sorts of energy sources impact our daily lives.
What drives petroleum product prices: Financial Markets
Gasoline and distillate both have futures contracts for delivery in New York Harbor on the New York Mercantile Exchange (Nymex). Since 2007, open interest (the number of contracts in a trading session that have not been settled or closed) and trading volume in these contracts increased for both products.
The Commodity Futures Trading Commission publishes a weekly activity report, the Commitment of Traders Report, on oil and petroleum product open interest on exchanges (e.g., Nymex). In this report, the activities of multiple trading categories are detailed, including physical participants (producers, merchants, processors, and end users), money managers (usually hedge funds or other sophisticated traders), and swap dealers (traditionally investment banks or commodity broker/dealers). Money managers generally tend to be net long—more futures contracts are bought rather than sold—on RBOB and ULSD futures, though significant changes in market expectations of demand and supply for these products can push overall positions to be net short.
The professional consultants at Onyx Power & Gas Consulting are always ahead of the current issues that may affect energy consumption and pricing. Now is the time to partner with an Onyx professional consultant to discuss energy management and secure energy prices based on today’s stable pricing. Volatility in the energy markets makes it too precarious to take chances. Partner with Onyx Power & Gas in Making Energy Make a Difference!