Wild Trading Action to Begin March

On March 4, 2014 by TradingDesk

Energy prices are pulling back, and global equities are soaring, this morning as Russia is sending signals of a softening stance in the Ukraine. Refined products and Brent crude are already trading below yesterday’s low values, while WTI is showing some relative strength, reducing its discount to Brent below $6/barrel for the first time in 6 months.

The wild action to begin March, in addition to the record setting inter-month spreads for both RBOB and ULSD futures leaves the technical picture muddled, and providing little direction going forward. RBOB futures are now back below $3, and risk dropping another 10-15 cents should they be unable to break above that level this week. All ULSD values beyond May are also trading below $3, and puts diesel values at risk for another slide down the backwardation curve towards $2.90.

It seems too soon to call an end to the price volatility sparked by violence in the Ukraine however, because if Russia’s president proved anything last year during the stand-off over Syrian chemical weapons, it’s that he plays political issues like a game of chess, and it may take some time for the strategy to unfold.

CLICK HERE for a PDF of today’s charts

Market Update (3)


Comments are closed.