• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 3 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 5 days Does Toyota Know Something That We Don’t?
  • 4 days World could get rid of Putin and Russia but nobody is bold enough
  • 13 hours America should go after China but it should be done in a wise way.
  • 6 days China is using Chinese Names of Cities on their Border with Russia.
  • 8 days Russian Officials Voice Concerns About Chinese-Funded Rail Line
  • 8 days OPINION: Putin’s Genocidal Myth A scholarly treatise on the thousands of years of Ukrainian history. RCW
  • 8 days CHINA Economy IMPLODING - Fastest Price Fall in 14 Years & Stock Market Crashes to 5 Year Low
  • 7 days CHINA Economy Disaster - Employee Shortages, Retirement Age, Birth Rate & Ageing Population
  • 7 days Putin and Xi Bet on the Global South
  • 8 days "(Another) Putin Critic 'Falls' Out Of Window, Dies"
  • 8 days United States LNG Exports Reach Third Place
  • 8 days Biden's $2 trillion Plan for Insfrastructure and Jobs
Martin Tillier

Martin Tillier

More Info

Why Even Long-Term Energy Investors Should Use Trading Techniques

For many investors, the word “trading” is a scary one. It conjures up images of somebody hunched over a keyboard for hours on end, with a huge bank of screens displaying massive amounts of data and charts. They simply can’t or at least don’t want to put themselves in that situation. That is understandable, but the nature of the energy markets makes it essential that even those whose attention is more fleeting understand and utilize at least some basic trading concepts.

The reason for that can be summed up in one word…volatility. It is important to understand here that while that word is often used to imply big drops in price it really means rapid, somewhat unpredictable movement both up and down, and virtually all major energy markets and stocks have shown plenty of that in the last year or so. Even large, integrated oil companies such as BP (BP: Chart below) have had a year of ups and downs.

(Click to enlarge)

That is easily explained. Everything energy related responds to some extent to fluctuations in the price of oil and natural gas, and those markets are themselves volatile. Consistent, one directional moves in commodity prices are rare because of the nature of the market and flexibility in production. Higher prices encourage increased supply which depresses the price until supply is reduced. At that point prices begin to climb again and the cycle is repeated.

That is economics 101, but it has implications…




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News