• 4 minutes "Natural Gas Trading Picks Up Considerably Amid High Volatility" by Charles Kennedy - ...And is U.S. NatGas Futures dramatically overbought at the $6.35 range?
  • 8 minutes How Far Have We Really Gotten With Alternative Energy
  • 12 minutes  What Russia has reached over three months diplomatic and military pressure on West ?
  • 5 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 53 mins Natural Gas is the Cleanest and most Likely Source of Energy to Fuel the World.
  • 2 days "Russia will stop 'in a moment' if Ukraine meets terms - Kremlin" by Reuters via Yahoo News...but Reuters suddenly cut out the balanced part of the story.
  • 1 day Advancing Fundamental Drilling Science - Geothermal drilling successes offer potential gain for petroleum industry
  • 8 hours The World Economic Forum (WEF) - Davos 2022 Conference held this last week of May
  • 4 days What China is Learning from Russia's War in Ukraine and its Consequences

Brokers Warn Clients Against ‘Dangerous’ Oil Futures

After the WTI Crude futures collapsed into negative territory this week, some brokerages have started to limit the ability of their smaller customers to place new trades in the June futures contracts of WTI and Brent Crude, two brokerages told Bloomberg on Thursday.

INTL FCStone Financial Inc and Marex Spectron are limiting customers, especially smaller ones, from initiating new trades in the two most active international crude oil futures contracts.  

INTL FCStone Financial Inc said in a memo to clients with accounts of less than US$5 million that they shouldn’t make new trades in WTI Crude and Brent Crude futures contracts for June delivery.  

“The reason for taking this action is for the best interest of our customers during these very unprecedented market conditions,” the memo seen by Bloomberg says.

Earlier this week, the United States Oil Fund LP (NYSEARCA: USO) - an ETF for crude – said in an SEC filing on Tuesday it was suspending the ability of the USO Authorized Purchasers to purchase new creation baskets. 

USO, one of the most popular oil-tracking ETFs for retail investors, was one of the reasons for the historic decline in May WTI futures on Monday. 

Pierre Andurand, a well-known energy trader, warned traders on Tuesday of massive losses in ETFs.

“I think the CME might have no other choice but to close out the ETFs positions. It cannot take the risk to have negative prices before the roll and be on the hook. This shock is real. Be very careful out there. We are going to hear about crazy losses in the days and weeks to come,” Andurand said on Twitter.  

Earlier this week, Paul Sankey, managing director at Mizuho Securities, who had warned of negative oil prices a month ago, said that the WTI Crude futures prices could crash to as low as a negative $100 per barrel in May.  

By Tsvetana Paraskova for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage



Leave a comment

Leave a comment

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