Looking at Oil prices at end of year

By Musabbir Mazhar

WTI Crude fell down about 1% on Tuesday morning to $98.27 per barrel for February delivery – oil finished the day at 98.42 on the New York Mercantile Exchange (NYMEX) – the largest commodity futures exchange. WTI is up 7% in 2013 – it crossed $100 per barrel on December 27^th last week which is the highest price in 2 months. The US economy improved this year and this infers higher demand for oil.

wti crude dec 31 2013 chart

55% of electronic trading volume of WTI were put options – or trades that expect oil prices would drop.  There was most active trading for call options of February delivery of $100 call options.

Brent crude dropped to $110.80 (-0.37%).

Brent/WTI spread was around $10.30-$13/ barrel in the last three weeks.

The oil traded lower on Monday (December 30^th) as oil supplies resumed from two of Libya’s oil ports Mesla and Sarir on the south eastern part of Libya. The Hariga port is still shut down – Libyan government has been trying to restore operations at this plant to take advantage of the revenue generating potential of Libya from oil supplies to rest of the world. Libya supplies 250,000 barrels per day – down from 1.4Million barrels per day early in July. The 2 ports are owned by the Arabian Gulf Oil Company based in Benghazi.