Oil Jumps On Short Squeeze: VelocityShares 3x Long Crude Oil ETN (UWTI), Inverse Crude ETN (DWTI)
Floor Talk: Oil +6%, boosting broader market; additional color on early gains
Oil is trading higher by 6% this morning and helping boost the broader equity market. The strength in oil follows reports that Russia’s Energy Minister suggested that OPEC and non-OPEC countries could meet next month to discuss supply.
While OPEC isn’t officially scheduled to meet again until June, and it is unusual for them to change supply outside of a normal meeting, the persistent weakness in oil increases the possibility of an extraordinary supply cut.
Oil moved higher on Tuesday on similar reports about possible supply cuts, coming out of Kuwait and Iraq at that time. This morning’s headlines build on those.
Oil remains a major driver for the broader market so headline risk and volatility should remain high given the focus on the potential for OPEC supply cuts now.
Crude oil is currently +1.86 at 34.17 (+6.0%). The S&P 500 is +1.1%. Strength in FB (+14%) is helping the Nasdaq (+1.4%) outperform.
VelocityShares 3x Long Crude Oil ETN (UWTI) jumps 19% to $2.51 and Inverse Crude ETN (DWTI) slumps 18% to $236.
Tags: Inverse Crude ETN (DWTI)), VelocityShares 3x Long Crude Oil ETN (UWTI)