Abstract: Importance of Technical Analysis of Petroleum Futures
J. H. Henderson
Recent structural changes of the global economy have resulted in "free market" forces determining the prices of petroleum products. In the early years of the petroleum age, market prices were unduly influenced by forces such as Standard Oil, The Texas Railroad Commission, "The Seven Sisters" and OPEC. Petroleum product prices set on the New York Mercantile and on the International Petroleum Exchange in London reflect the current supply/demand judgement of informed participants. In dollar terms, crude oil is the worlds most important commodity. Large capital pools such as hedge and pension funds seek risk diversification through purchases of derivatives such as the Goldman Sachs Commodity Index futures contract established in 1991. Global computerized trading made possible in part by advances in telecommunication technology can result in rapid market adjustments. Computer assisted mathematical analysis of price, volume, open interest, momentum, volatility, and premiums is useful to the working energy professional when plan ing upstream activities such as production purchases or drilling programs.
AAPG Search and Discovery Article #90960©1995 AAPG Southwest Section Meeting, Dallas, Texas