With Physical Hedging on Rise, Production Response May Weaken
With OPEC and non-OPEC production cuts on the horizon (although not guaranteed), institutions exposed to oil have shifted their outlooks for price risk, as reflected in their current positions in NYMEX WTI futures and options. As the WTI forward curve has shifted into backwardation, analysts are calling for swollen inventories to be drawn down towards the middle of 2017, pulling the market back into balance.
Physical Holders Show Increased Hedging
The physical industry continues t...

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