while in Russia, dozens of investors of Mosberg lost millions due of the collapse in oil prices, in the UK there was a trader who managed to earn more than $9 million, when WTI futures went negative.
this was reported Bloomberg, citing a source.
we are Talking about oil trading company from London, and BB Energy. April 20, the day of the collapse of prices in a negative value, it bought 250,000 barrels of oil. While the other bidders had unsuccessfully tried to get rid of raw materials and were even ready to pay for those who will take their oil. By the closing trading price fell to -$37,63 per barrel.
In the conditions of falling of demand for fuel while maintaining production volumes, a store was full. May the turnover of oil in the world is estimated at 2.43 million barrels — BB Energy took about 10% of the total. And along with oil and got the same “surcharge”, a little over $36 per barrel, or $9 million of the total.
According to Bloomberg, BB Energy is a family-run trading house, which started operations in 1937 with the grain trade and asphalt in Lebanon. In addition to the headquarters in London, the company has an office in the United States. In a year it handles 20 million tons of oil and oil products.
the Crisis in the oil market began in March, when participating countries transaction OPEC+ are unable to negotiate a new deal to reduce oil production. Its a necessity it is due coronavirus that stopped businesses around the world and brought down the demand for fuel. The result is price war to the end of March, Brent was worth about $22 per barrel at a price of $66 at the beginning of 2020.
April 12, countries managed to agree on reducing production to 9.7 million barrels per day in may-June with the gradual increase within two years. Another 10 million barrels has promised to leave in the bowels.
However, by the time many tanks were already overcrowded, became an unpleasant surprise for the holders of futures. Buying them, the investor agrees to buy oil at a fixed price by a certain date. If at that time the price rises, the holder of the futures contract may resell it at a profit. But for profit it is necessary that the market was not demand for futures and for real product.
as a result, on 21 April, following the expiry of the term of trade may futures, many traders have found that no one wants to buy back their commitments at the may oil. And since the physical stores, the majority of traders no, they had to sell contracts at a huge discount.
the Moscow exchange was not ready to trading on the negative values and reacted to the situation of the complete freezing. Therefore, Russian investors are unable to get rid of illiquid assets and you��widely was to watch how their futures turn into huge debt to brokers.
Anatoly Kruglov
