Chapter 632 Price Difference

"Milton's quota has been used up. Do you want to continue to invest?" Qi Xiao pushed the door and entered. Since the official start of the futures war, he moved the base camp to the second floor of the exchange.

Su Cheng said without raising his eyelids, "Keep the current strength. If you don't have enough funds, increase the leverage."

"Increase leverage?"

"Up to 15 times."

Leverage is to leverage a large amount of funds with a small amount of money, which is the most interesting margin design for futures trading. Futures traders only need to provide 10% or less money to get full funds from banks or other financial institutions to buy futures.

Once the fluctuating loss of the futures contract exceeds the margin set by the trading party, the bank will ask for an additional amount. If the trading party's funds are insufficient, the bank will unceremoniously close the position, thus recover its own funds. In this case, no matter how much money the trading party has, it will not be paid

In the futures exchange, it is impossible to have no leverage at all, because the volatility of the futures contract itself is very small, and you can't make money without amplification. Su Cheng was so tired that he got a result of a $2 drop in oil prices. If there was no leverage, the TransAsia Fund would have earned 10% to 20% in this round, but with more than 10 times the leverage, their profit would reach 100%.

In addition to insider trading operations such as Sucheng, it is rare for normal futures contracts to have a 3% fluctuation. If there was no leverage, the so-called financial people would have changed their business one after another.

However, increasing leverage means increasing risk, if the price of crude oil returns from $16 to $18. The deposit of Dahua Industry has to be increased.

Qi Xiao obviously didn't think that $16 was the central point. He hesitated and said, "Today's trading time is almost over. Slow down a little. I estimate that billions of dollars will be enough..."

"There is more than one battlefield. Go and give orders." The order given by Sucheng is direct and clear.

Qi Xiao confirmed it, but his eyes lit up and asked, "Su Dong, where else is the battlefield?"

"You will come in another hour. If you have a good chance, we will operate it."

"Received." Qi Xiao ran out with the wind under his feet.

The oil price has remained between $16 and $16.50 for a long time. As the closing time approaches, most people think that oil prices have temporarily stabilized.

Qi Xiao also took advantage of his free time to sneak into the small office in Sucheng. He asked again, "Su Dong, where is the second battlefield?"

"What do you think?"

"New York Mercantile Exchange!" Qi Xiao's excited eyes lit up, and his tone was extremely certain.

After all, global crude oil futures trading. One on the International Petroleum Exchange in London. One on the New York Mercantile Exchange. The price of crude oil in London has fallen, and it is impossible for New York not to be affected. In fact, today's arbitrage of West Texas medium crude oil in New York has made a lot of money, and the price of wti has also approached $16 from $17.12.

Su Cheng smiled mysteriously and said, "I guessed half of it."

"Half?"

"We make the price difference." Su Cheng didn't sell any more.

The so-called price difference is the price difference between North Sea Brent light crude oil on the London Stock Exchange and West Texas medium crude oil on the New York Stock Exchange. Of course, it is North Sea Brent light crude oil and West Texas medium crude oil. However, as long as the standards set by both are met, they can be shipped into the delivery warehouse.

But that's why. The prices of the two are affected differently. North Sea Brent light crude oil on the London Stock Exchange can be shipped to overseas markets, which makes its price more vulnerable to political factors and the interruption of crude oil exports. The delivery warehouse of West Texas medium crude oil is in the Cushing area of Oklahoma, USA, and its price is more vulnerable to the local economy and weather in the United States. .

In other words, the crude oil price on the London Stock Exchange is more international, while the crude oil price on the New York Stock Exchange is more American.

If the weather in the United States becomes cold, or the U.S. economy is strong, the price of crude oil on the New York Stock Exchange will rise. At the same time, the price of crude oil on the London Stock Exchange will not change much, which will form a price difference.

For most of 94 years, the price of North Sea Brent in London was higher than that of wti in New York. However, the plunge in crude oil today has made the price in New York higher than in London.

If the price difference between the two is correctly judged, the profit is also not small.

Qi Xiao nodded. There were few opportunities to make futures in China. Before 2000, it was either a few tycoons who accidentally broke into the market, or simply a national-sized trader. It would be better to get involved in such a high-end futures variety as crude oil price difference.

"If you decide, what direction will you take?" Su Cheng looked at his watch and took the school exam.

This is an important question. Qi Xiao's spirit suddenly became nervous and thought carefully.

He is already coordinating and contacting crude oil speculation. If he can't give a correct answer, Su Cheng may find another person in charge.

For Qi Xiao, who just fell in love with this position, he absolutely doesn't want this.

Crude oil price difference contract, or gambling price difference increases, or gambling price difference decreases, there are only two answers. Choose one at will, the chance of winning the prize is 50%, and the chance of failure is also 50%. For those who can't bear the loss, this is a more difficult decision.

"The spread will narrow... If I decide, I will choose the direction of narrowing the spread." Qi Xiao struggled to spit out the answer, and the next sentence was much smoother: "The price of London crude oil hit the bottom, and the price in New York fell in the form of arbitrage. Next, once the price in London rebounds, the price in New York will rebound at a faster rate, but the price of its rebound will certainly not exceed the original price, First, the price difference between the two is mainly to reduce. In addition, we can also control the rising speed of oil prices in London to a certain extent, and it is more beneficial for us to control the risk by choosing to narrow the spread.

"The analysis is good." Su Cheng smiled a little.

Qi Xiao also smiled.

Then, Su Cheng smiled and said, "It's a pity that it's wrong."

"Puff..." Xiao Pang, who is so bored that he is bored. Spray tea in the corner.

Qi Xiao is also very embarrassed.

Su Cheng shook his hand and said, "You are right to narrow the price difference, because you don't have all the information. I'm afraid something else will happen in the next day or two, so... Do you have the confidence to contact both sides of the Atlantic at the same time?

"No problem." Qi Xiao was excited again, like a man who was awakened twice a night. He felt proud and powerful. When the breath dissipated, he tried to ask, "What is the information you said that I didn't have?"

"OPEC."

"OPEC?" It took Qi Xiao two seconds to understand this word. After two seconds, his whole face turned red, as if he had been awakened three times a night.

For people in the oil circle. This deformed giant is always the highest-end existence. The organization composed of 12 oil-producing countries cannot be described too much. Not to mention the strength of other companies' alliances. If a long-term joint organization is formed, the first thing to face is the anti-monopoly laws of each country. In those years, European and American companies led by Exxon and bp wanted to negotiate with OPEC, and they had to deliberately find the U.S. Department of Justice to get a written material that would not be prosecuted for monopoly, so that they could take a plane. The OPEC organization, which completely ignored Western laws, had its own freedom and resources were unmatched by .

Qi Meng had to look at Su Cheng's eyes. He asked in a low voice, "Do we have any news about OPEC?"

"That's right."

"Not yet released?"

"The news hasn't happened yet." Su Cheng stared at him before Qi Xiao put away his cautious appearance.

or. Comrade Qi Xiao was shocked again. He was shocked.

What is the situation of the news that didn't happen? When he figured out this problem, he was already in the state of Shijiro overnight - his eyes were dull, weak, paralyzed and dull...

"Is it OPEC's high-level meeting?" Qi Xiao didn't guess randomly. In the past month, the OPEC meeting that could happen was just like this.

OPEC is an inter-country organization, which also means that their coordination is very complicated. Therefore, the number of meetings that OPEC can hold each year is limited, and the quality of meetings is limited. Generally, this year's meetings have to be scheduled last year.

Unread high-level meeting. Although the level is very high, it has good flexibility. You can do it in advance or later.

Su Cheng nodded slightly and said, "Sir Aliyev has been invited and should have arrived now."

Azerbaijan is not a member of OPEC, but as an oil-producing country other than OPEC, its identity is equally important.

Qi Xiao didn't have the strength to do Gojiro for one night, and he no longer asked for specific details. He said categorically, "I'm going back to prepare."

"Maintain the rhythm of shorting, don't be afraid."

"Undert it." Qi Xiao is full of confidence.

......

As soon as Aliyev landed in Geneva, he was connected to the Saudi limousine.

The purpose of OPEC was to fight against Western countries, and their main means is to coordinate the oil policies of oil-producing countries and agree on crude oil production and prices.

During the first and second oil crises, OPEC won the victory by reducing production and embargoing. The era of low oil prices came to an end, and the golden period of the economies of European and American countries was over. Since then, OPEC's policy has become the weathervane of the oil market. Whether it is the OPEC ministerial meeting or the high-level meeting between OPEC member countries, it has affected international oil prices. As usual, it is also the protagonist of news around the world.

Also thanks to the efforts of OPEC, crude oil prices remained stable throughout the 1990s, bringing huge profits to oil-producing countries.

However, competition is always the mainstream of the market.

In order to maintain the stability of crude oil prices, oil-producing countries often produce less than the actual production capacity. The Middle East has been doing transportation and refining construction all year round, but it rarely uses advanced oil production methods, especially oil production equipment that increases the speed of exploitation. It has always been difficult to promote in the Middle East. Countries like Iran have not updated their own oil production equipment from the 1970s to the 2010s. Of course, this is not because their oil production equipment is durable, but because there is no demand for increased production, and there is no need to update and better equipment.

However, every oil-producing country is willing to limit production. For example, during the reign of Saddam in Iraq, Iraq was the most disobedient student in the OPEC class. The means of forcibly increasing production, stealing production, and even threatening to withdraw were used by Saddam, especially at the end of the Iran-Ira After that, the poor and crazy Saddam didn't care what OPEC said at all, just blindly increased production.

In oil-producing countries other than OPEC, it has also caused OPEC's troubles, especially those crude oil importers and exporters, which have always been the focus of OPEC's.

The reason is very clear. Crude oil self-sufficiency or crude oil importers, no matter how large their domestic production is, are buyers in the international market. Their crude oil will not appear in the international market, and they can't do it even if they want to hoard it. Americans will only build a 90-day crude oil reserve in the end, right The short-term impact of the market is not small, and the long-term impact is hard to say.

On the contrary, those net exporters of crude oil that are similar in nature to OPEC countries but are not OPEC countries, so OPEC has to be cautious. For example, Mexico, Oman, Brunei and other countries, although their crude oil production is not necessarily much more than that of countries like the United Kingdom, because most of the crude oil they extract is used for export, they have a much greater voice in the international market.

For the sake of protecting interests, when determining the annual output, OPEC will contact these countries to set an approximate oil production target, so as not to reduce the output but fail to achieve the target, and finally give up the cheapness to others.

At present, the politics of the Soviet republics has gradually stabilized, and after crude oil production has gradually recovered, countries such as Azerbaijan and Kazakhstan have become the objects of OPEC's efforts.

Aliyev also needs the diplomatic support of Middle Eastern countries at this time, but what is more important is to strive for economic benefits for Azerbaijan.

Sucheng launched a crude oil offensive at such a point in time, and Aliyev was happy to see it, which proved the importance of Caspian oil from another side.

In fact, the Caspian Petroleum Circle is indeed the second only oil producing area after the Middle East Petroleum Circle, but it has not yet been recognized by the international oil community.

If the Azijiu oil field is handed over to bp for development, it will not only slow down the development progress as in history due to its own global strategic considerations. When British and American diplomacy needs, bp can also adopt maintenance, full start, semi-start and other methods to affect international oil prices. If Aliyev wants to strive for diplomatic benefits, It has become much more difficult.

As for now, when the production capacity of 150,000 barrels per day broke out in the Azijiu oil field, OPEC countries can't pay attention to it.

Because in order to achieve their expected oil prices, OPEC countries often make promises to reduce production by only 1 million barrels per day. In the world economic crisis in 2008, OPEC only reduced production by 1.5 million barrels for the first time, and finally achieved only 75% of the target.

Azerbaijan, which became independent from the former Soviet Union, suddenly entered the international crude oil market, opening 11 new oil fields. Needless to say, Aliyev's popularity.

"It seems that you can really open your mouth." Aliyev enjoyed the attentive service of the Saudis and couldn't help thinking of what Sioux City said.

......(To be continued..) RT