Monday, January 9, 2012

Oil shifts - expect tremours - Iran and Indexes re-jig

Expect tremours in the oil markets:

click on link for full story

West readies oil stocks release, Iran plans war
By Robin Pomeroy and Peg Mackey
TEHRAN/LONDON, Jan 6 (Reuters) - Iran announced on
Friday new military exercises in the Strait of Hormuz, but
the West has readied plans to use strategic oil stocks to
replace almost all Gulf oil lost if Iran blocks the waterway,
industry sources and diplomats told Reuters.

Oil markets brace for turbulence of index shift
By Joshua Schneyer and Matthew Robinson
NEW YORK, Jan 6 (Reuters) - Amid the drama of Iran, the
meltdown of refiner Petroplus and a wave of upbeat economic
data, it was all too easy to overlook one of the most
important short-term factors shaping oil markets this
week: the reweighting of the world's biggest commodity
The S&P GSCI Index and the DJ-UBS Index, the world's no.
1 and no. 2 commodity indexes, announced two months
ago plans to rejig their component weights to reflect growing
trade in European benchmark Brent crude, at the expense
of U.S. WTI, which some traders say had become
detached from global prices.
The transition is now nigh: over the course of five days next
week, pension funds and investors who have an estimated
$180 billion tracking those indexes will transfer their holdings
from prompt futures contracts into later months.

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