Rising of the price of crude oil to over 135 dollars for a barrel was due to the fact that traders of Wall Street were purchasing crude oil to meet their erroneous bets that prices would fall, according to data of the New York Stock Exchange trading.
The number of open futures contracts has fallen by 8.1% in a week - to 1.36 million, while their prices have increased by 2.6%, the data show. The drop-down number of open contracts and rising prices are a sign that traders buy to leave the so-called short positions, which would bring profit if the price of oil falls, and loss if the price increases.
The contracts with delivery period of July became more expensive by 1.4% to the record 135.09 dollars per barrel on the New York Stock Exchange trading today. Prices of oil futures, which rose after a government report showed that U.S. stocks had fallen unexpectedly, have increased twice in the last year.
The number of open contracts has been falling for the past few months after reaching the record 1.58 million on July 16, 2007.
Over the past year market participants have increased bets that prices, known as long positions, will grow by 37% to 263 378 contracts, it was announced on May 16.
The aim of everyone in the moment to buy back contracts may be affiliated with the record number of short positions, which has accumulated in recent weeks from less speculative players. These investors held 123 194 futures contracts, under which prices of oil futures will fall during the week which ended on May 6. The number of contracts is a historical record and exceed by 47% of that of the bets that prices will go up.
Oil have closed at record prices in 27 days since the beginning of the year, forcing the ministers of the member countries of OPEK to announce that the rise is due more to investors than insufficient supply.
Crude oil with delivery time in December 2016 closed yesterday session at a price of 142.09 dollars for a barrel, giving a sign that investors have expected prices to go up for years ahead. Some traders speculate that the price of the black gold will reach 200 dollars for a barrel this year.
Heads of U.S. oil companies argued before the Congress yesterday that oil prices must have been in the range of 35-90 dollars for a barrel.
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