Friday, July 3, 2009

Steven Perkins Perks Up Oil Market

A spike in oil prices to their highest level this year on Tuesday was caused by a rogue broker, Steven Perkins, who placed a massive bet in the Brent oil market, triggering almost $10m (€7m) of losses for his company, PVM Oil Associates.

Prices rose in one hour from $71 to $73.5, the highest level for the year, according to FT. In total, futures contracts for more than 16m barrels of oil changed hands in that hour – equivalent to double the daily production of Saudi Arabia, the world’s largest oil producer, and far more than the traditional 500,000 barrels for that time of the day

1 comment:

  1. Assuming it was intentional, he was probably hoping to trigger buy stops. At 1,000 barrels per contract, the volume traded was 15,000 contracts. If he was responsible for 1/3, the $10 M only represents a 2 point loss, which is very lucky. The fact that the price did not go much higher was pretty bearish at that moment.