Oil trade - long term, opinions please!

limey16

limey16

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I like incrediblefx on the other thread for Long term oil investment am considering going long on Oil for 1/2 years.

Will probarbly do this through an SB company - they only offer the front end months, current one is Feb contract, I actually have enough in my account @ £1 to let it breathe all the way down to $0 dollars - which I expect will never happen, though $30 a barrell or $20 could happen

My question is I will have to obviously rollover the contracts, can anyone see any problems in this ? Obviously the new contract price may be different to the one thats expiring, just wondering if anyone can envisage something else I need to account for ?

Any opinions and ideas welcome,


Cheers

Jon
 
hey jon,
Im in a similar boat. I went long on the March Brent contract... but its taking a dive at the moment. Wish I was getting in now rather than when I did! Anyhow - one thing you may want to clarify with your SB firm is whether you will be forced to close out your long at the expiry date. I think probably yes? If so, its not quite as watertight... as even if you can afford to sit out oil all the way down to zero, chances are you would have to close it out before then! Just my 2cents worth. Good luck!
 
If you do it with someone like avafx they will roll it over for you and either credit/debit your account to balance out the price difference at rollover.
 
welshandy1 said:
hey jon,
Im in a similar boat. I went long on the March Brent contract... but its taking a dive at the moment. Wish I was getting in now rather than when I did! Anyhow - one thing you may want to clarify with your SB firm is whether you will be forced to close out your long at the expiry date. I think probably yes? If so, its not quite as watertight... as even if you can afford to sit out oil all the way down to zero, chances are you would have to close it out before then! Just my 2cents worth. Good luck!
Click to expand...


Hey Andy

Thanks for the reply, its a tough one isn't it, picking bottoms and tops is notoriously tricky and can go the shape of the pear, I normally scalp (not with an sb!!) with the trend, I thought with this I'll try not to and just let it run - its never going to below $0 so if I can ride it out why not

I think OPEC are doing are large production cut in Jan - and apparently there will be compliance so it may have an effect, the last one didnt but it wasnt a drastic as this one. The flipside is world demand ?! - is anyone going to want more?? a coupl eof columists in City am projected $70 a barrel sometime in 09, would be happy with that, back to $100 + laughing.

I checked with the sb - it is rolled over - but that means a close and the new contract taken, my feb expires on Jan 16th, have to speak to dealers before then to instruct. Whether Im up or down at that point I presume taking the the March contract will equate to moving with price as the year goes on??!

All the best for your position

Jon
 
It might be time to calculate how much oil im going to use in my lifetime, currently not much not being a driver , and hedge my position in the futures market, i dont want to start driving and have to pay $140 a barrel....unless ofcourse im a few pounds long from $40 :D :p
 
Hey Jon,

Keep me posted, Id be interested to see how that rollover works, and what the cost is to you. Not had chance to check on how it works with my SB firm (GFT). Who are you with?
I agree with regard to never going to $0, but as this isnt spot prices, I assumed that that was the catch... i.e. I'd be forced to close the deal at whatever the price was at contract expiry.

Sure, given a year or two, its pretty much guaranteed to increase... but its the short-term bit inbetween that worries me...

anyhow, good luck!
Andy


limey16 said:
...

I checked with the sb - it is rolled over - but that means a close and the new contract taken, my feb expires on Jan 16th, have to speak to dealers before then to instruct. Whether Im up or down at that point I presume taking the the March contract will equate to moving with price as the year goes on??!

All the best for your position

Jon
Click to expand...
 
If ground offensive starts in Gaza which is looking likely,and tensions with Iran increase,I think it's a good play to be long oil medium to long term,it's hard to see it not hitting $50 a barrel before the March contract expires,so with a chunky stop you should be ok
 
Last edited:
oil has destroyed its future by the mad run up to 147$.. actually we may see oil.. around 20/30..

in future oil will not play ANY KEY ROLE..

however oil can recover to lets say about maximum 100$..

enjoy
 
RidderTrade said:
oil has destroyed its future by the mad run up to 147$.. actually we may see oil.. around 20/30..

in future oil will not play ANY KEY ROLE..

however oil can recover to lets say about maximum 100$..

enjoy
Click to expand...

the only word in your post to make any sense :p
 
not really.. after oil has bottomed there will be a countertrend.. but that will last for maybe maximum 6 months.. after that.. it will decline.. like a Baksteen (as we say in Holland :)

enjoy

welshandy1 said:
Hey Jon,

Keep me posted, Id be interested to see how that rollover works, and what the cost is to you. Not had chance to check on how it works with my SB firm (GFT). Who are you with?
I agree with regard to never going to $0, but as this isnt spot prices, I assumed that that was the catch... i.e. I'd be forced to close the deal at whatever the price was at contract expiry.

Sure, given a year or two, its pretty much guaranteed to increase... but its the short-term bit inbetween that worries me...

anyhow, good luck!
Andy
Click to expand...
 
hehe :)

trying to be smart..

at a forum in holland.. i forecasted correctly.. a sharp fall in gold.. euro.. and in oil..
where rarely no one see those coming..
as a matter of fact i called for gold to go to 6xx, oil to 60 ( i got more than i asked for ;) )
and the euro to 12x

do you know, to whom you are talking? :D

dilesh23 said:
the only word in your post to make any sense :p
Click to expand...
 
the chinese must be mad stockpiling it underground facilities at current prices :LOL:

they must think it will have no role for the types of keys they have (car ones)

those crazy chinese people :smart: first buying englands gold reserves at v. low prices from gordon brown now this :-0

makes you wonder about communist economics :p
 
nope dont know to whom im talking too... :confused:but im guessing you dont reside too far from your local "coffee shop" and are a frequent customer :p might have seen you there:eek: but No i dont know you :cool:
 
world will rely more on alternative energy fuels in future..

as i said before.. most of the oil decline we have seen.. after bottom is put in.. expect bounce ..

but Remember..after that.. we fall again.. like oil has no value..

RidderTrade
 
dilesh23 said:
nope dont know to whom im talking too... :confused:but im guessing you dont reside too far from your local "coffee shop" and are a frequent customer :p might have seen you there:eek: but No i dont know you :cool:
Click to expand...

i see you have hanged around this site for some time.. :)

i have been a invisible member since 2007.. but i will visit here more frequently
without any delay :clap:
 
RidderTrade said:
world will rely more on alternative energy fuels in future..

as i said before.. most of the oil decline we have seen.. after bottom is put in.. expect bounce ..

but Remember..after that.. we fall again.. like oil has no value..

RidderTrade
Click to expand...

after a bottom i normally do expect a bounce ..hence it being a bottom.... and if it does fall again then .... well it wasent a bottom to begin with :p

put the spliff down mate and step away from the space cakes (y)
 
i am not an expert but common sense says that you can rollover the contracts.
however if there is a deficit you will have to fund it obviously.
good luck.























limey16 said:
I like incrediblefx on the other thread for Long term oil investment am considering going long on Oil for 1/2 years.

Will probarbly do this through an SB company - they only offer the front end months, current one is Feb contract, I actually have enough in my account @ £1 to let it breathe all the way down to $0 dollars - which I expect will never happen, though $30 a barrell or $20 could happen

My question is I will have to obviously rollover the contracts, can anyone see any problems in this ? Obviously the new contract price may be different to the one thats expiring, just wondering if anyone can envisage something else I need to account for ?

Any opinions and ideas welcome,


Cheers

Jon
Click to expand...
 
well Jon if you had took the trade,on the march brent you would be sitting on a tidy profit now.
 
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