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One big order, thousands of small ones, seen behind oil tumble

IBN Live -- NEW YORK (Reuters) - A single large sell order in the benchmark European Brent oil market, followed by an abrupt U-turn among high-frequency traders, may have caused one of the most abrupt price routs ever, brokers and analysts said on Tuesday.

As the dust settled on Monday's four-minute, nearly $4 plunge, other possible causes such as an erroneous "fat finger" trade, a computer program run amok or a broad, rumor-driven sell-off were set aside in favor of a combination of one big trade - potentially as much as 12 million barrels worth some $1.4 billion - and tens of thousands of computerized orders.

"There was most likely a large fundamental seller in the market yesterday," said Eric Scott Hunsader, Chief Executive of Nanex, a trading consultancy that regularly conducts detailed fore

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Submitted Sep 19, 2012 By: aservant

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rcornero Sophomore Author Toms River Posts:225 Points:367,560 Joined:Mar 2011	Message Posted: Sep 20, 2012 7:24:33 AM Ignore rcornero Report Abuse QE3 is not going to help. The market knows this.
remay Champion Author Houston Posts:6,973 Points:2,118,590 Joined:May 2006	Message Posted: Sep 20, 2012 7:21:00 AM Ignore remay Report Abuse Traders run amuck! Yikes!
spiderjay Champion Author Little Rock Posts:4,773 Points:1,282,235 Joined:Oct 2005	Message Posted: Sep 19, 2012 6:18:10 PM Ignore spiderjay Report Abuse dont get it
GatorGuy Champion Author Columbia Posts:2,233 Points:1,208,220 Joined:Jan 2009	Message Posted: Sep 19, 2012 4:21:34 PM Ignore GatorGuy Report Abuse It was me, I was just stocking up while oil prices were so 'favorable'.
ZeroBoxes Champion Author Mississippi Posts:1,079 Points:213,340 Joined:Apr 2012	Message Posted: Sep 19, 2012 3:19:23 PM Ignore ZeroBoxes Report Abuse Sure am glad I took Managerial Accounting when it wasn't popular.
JXQW Champion Author Kansas City Posts:2,787 Points:684,925 Joined:Jul 2008	Message Posted: Sep 19, 2012 2:25:28 PM Ignore JXQW Report Abuse no fat finger no flash plunge just a maneuver ...!!
Cheepo Champion Author Tampa Posts:9,889 Points:3,128,005 Joined:Apr 2003	Message Posted: Sep 19, 2012 1:34:21 PM Ignore Cheepo Report Abuse Drill baby drill here and now!!!!!!!!
QualTekGuy Champion Author Illinois Posts:3,071 Points:734,825 Joined:Feb 2007	Message Posted: Sep 19, 2012 1:14:47 PM Ignore QualTekGuy Report Abuse And yet, the price at the pump won't go below $4 at the stations in my area.
Jeff4U Champion Author Atlanta Posts:8,762 Points:1,854,095 Joined:Nov 2004	Message Posted: Sep 19, 2012 12:36:27 PM Ignore Jeff4U Report Abuse All I've got to say to speculators is HahaHa!!! I hope they all have that sick feeling in the gut, the same one we feel when we visit the gas pump.
1972Pinto Champion Author Wisconsin Posts:189,098 Points:284,255 Joined:Aug 2012	Message Posted: Sep 19, 2012 12:08:02 PM Ignore 1972Pinto Report Abuse that's technology set the range on your computer to buy low sell high. when you are dealing with so many people set up like that, it's a chain reaction
sydb7 Champion Author Atlanta Posts:3,561 Points:1,919,985 Joined:Mar 2003	Message Posted: Sep 19, 2012 11:58:20 AM Ignore sydb7 Report Abuse Speculators trying to manipulate prices higher than they should be! 1% greed! [Edited by: sydb7 at 9/19/2012 11:59:00 AM EST]
nskmda Champion Author Grand Rapids Posts:1,290 Points:787,530 Joined:May 2007	Message Posted: Sep 19, 2012 11:43:39 AM Ignore nskmda Report Abuse @babyjudy it's a "free market", man. =)
F81M Champion Author Indiana Posts:1,504 Points:788,110 Joined:Aug 2008	Message Posted: Sep 19, 2012 11:37:04 AM Ignore F81M Report Abuse It will all balance out, no need to get excited.
rtw777 Champion Author Florida Posts:9,401 Points:1,842,970 Joined:Jan 2008	Message Posted: Sep 19, 2012 11:35:06 AM Ignore rtw777 Report Abuse Blame it on the finger.
nauzad Champion Author Las Vegas Posts:1,024 Points:286,655 Joined:Mar 2010	Message Posted: Sep 19, 2012 11:25:41 AM Ignore nauzad Report Abuse Speculations and finance guys.
Mariuxus Champion Author Chicago Posts:3,765 Points:1,872,040 Joined:May 2007	Message Posted: Sep 19, 2012 11:15:24 AM Ignore Mariuxus Report Abuse ok
Wolfwings Champion Author Delaware Posts:8,745 Points:1,777,440 Joined:May 2004	Message Posted: Sep 19, 2012 11:04:50 AM Ignore Wolfwings Report Abuse I guess we need MORE "Fat Finger" trades like this.
99church Champion Author Indiana Posts:1,826 Points:363,015 Joined:Oct 2011	Message Posted: Sep 19, 2012 10:57:25 AM Ignore 99church Report Abuse its been 3.99 here for about 3 weks now
chuckhermann All-Star Author New York Posts:967 Points:500,175 Joined:Jun 2011	Message Posted: Sep 19, 2012 10:56:05 AM Ignore chuckhermann Report Abuse Forget being told, will anyone other that the folks who initiated it every really know. And since they did it and saw the reaction, what's to keep them from planning to do that again, then buy back their position when the prices plummet?
VernonOR Champion Author Oregon Posts:2,920 Points:738,845 Joined:Aug 2010	Message Posted: Sep 19, 2012 10:54:42 AM Ignore VernonOR Report Abuse Cheapest price in town today $3.87, that is not good news as far as I'm concerned.
Rans35PG Champion Author Modesto Posts:2,470 Points:996,250 Joined:Oct 2008	Message Posted: Sep 19, 2012 10:54:32 AM Ignore Rans35PG Report Abuse feel bad for the traders. Not.
zimowski Champion Author San Jose Posts:6,676 Points:1,585,440 Joined:Nov 2007	Message Posted: Sep 19, 2012 10:53:42 AM Ignore zimowski Report Abuse Will we ever be told what really happened?
fieldt Champion Author Lansing Posts:3,935 Points:730,475 Joined:Mar 2011	Message Posted: Sep 19, 2012 10:51:31 AM Ignore fieldt Report Abuse I thought so too, TBRR.
Old Timer Champion Author Akron Posts:3,747 Points:1,263,990 Joined:Sep 2003	Message Posted: Sep 19, 2012 10:51:11 AM Ignore Old Timer Report Abuse Less than 4% of the price is NOT a plunge.
scrossi Champion Author Indiana Posts:3,889 Points:1,049,465 Joined:Dec 2008	Message Posted: Sep 19, 2012 10:50:37 AM Ignore scrossi Report Abuse Agreed jimmy544.
bjdorval Champion Author Quebec Posts:2,264 Points:1,135,905 Joined:Jul 2008	Message Posted: Sep 19, 2012 10:49:46 AM Ignore bjdorval Report Abuse Can we have more deregulation in the financial markets like the Tea Party folk are preaching?
RonElp All-Star Author El Paso Posts:763 Points:109,620 Joined:Aug 2012	Message Posted: Sep 19, 2012 10:49:43 AM Ignore RonElp Report Abuse I couldn't agree more jimmy544
jimmy544 Champion Author Boston Posts:4,123 Points:654,830 Joined:Feb 2011	Message Posted: Sep 19, 2012 10:47:42 AM Ignore jimmy544 Report Abuse This is an example of what is wrong with the US equity markets. The speculators have too much control over the direction of the markets not the consumers. Violent price swings mark this speculative power and that is what we have seen. Time to get the speculating banks, hedge funds and other big players to have to take possession of the commodity. This will make it much harder for the speculators to control the price of oil.
TBRR Champion Author Jacksonville Posts:3,672 Points:599,320 Joined:Dec 2007	Message Posted: Sep 19, 2012 10:46:32 AM Ignore TBRR Report Abuse nearly $4 plunge??? more like a trickle down to me considering the high price of Brent. poor choice of words by Reuters. in god we trust
paulp24 Champion Author Harrisburg Posts:4,547 Points:823,300 Joined:Dec 2010	Message Posted: Sep 19, 2012 10:46:09 AM Ignore paulp24 Report Abuse Koch brothers...
ddgb40 Champion Author Las Vegas Posts:1,431 Points:360,380 Joined:Jan 2012	Message Posted: Sep 19, 2012 10:46:07 AM Ignore ddgb40 Report Abuse Ok
LoadToad Champion Author San Diego Posts:1,364 Points:1,298,045 Joined:Sep 2005	Message Posted: Sep 19, 2012 10:44:33 AM Ignore LoadToad Report Abuse Looks like somebody is/was playing games.
gws2980 Champion Author Philadelphia Posts:2,186 Points:502,090 Joined:Oct 2010	Message Posted: Sep 19, 2012 10:43:23 AM Ignore gws2980 Report Abuse not saying who
40mpgsaturn Champion Author Wisconsin Posts:2,500 Points:522,380 Joined:Jun 2011	Message Posted: Sep 19, 2012 10:43:07 AM Ignore 40mpgsaturn Report Abuse We can't win!
1heatguy Veteran Author Wisconsin Posts:311 Points:154,845 Joined:Jan 2012	Message Posted: Sep 19, 2012 10:41:22 AM Ignore 1heatguy Report Abuse okkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkkk
crep1291 Champion Author Ottawa Posts:2,583 Points:481,250 Joined:Dec 2010	Message Posted: Sep 19, 2012 10:41:02 AM Ignore crep1291 Report Abuse Gasoline is 5.7c/L (21.5c/gal) in Ottawa today. Back to prices we had before the big jump last week.
Teddy95 Champion Author Dayton Posts:41,150 Points:2,697,100 Joined:Oct 2005	Message Posted: Sep 19, 2012 10:40:32 AM Ignore Teddy95 Report Abuse Hmmm...
ted4636 Champion Author Cleveland Posts:3,491 Points:1,638,635 Joined:Jun 2007	Message Posted: Sep 19, 2012 10:39:13 AM Ignore ted4636 Report Abuse what!
AC-302 Champion Author Los Angeles Posts:26,588 Points:2,903,070 Joined:Aug 2004	Message Posted: Sep 19, 2012 10:38:27 AM Ignore AC-302 Report Abuse This has to be due to Robo-Trading.
SUPERSTEVIEO Champion Author Quebec Posts:3,523 Points:787,115 Joined:Oct 2010	Message Posted: Sep 19, 2012 10:38:23 AM Ignore SUPERSTEVIEO Report Abuse ??? so??? what now???
Insuremn Champion Author Twin Cities Posts:4,957 Points:1,031,985 Joined:May 2010	Message Posted: Sep 19, 2012 10:38:03 AM Ignore Insuremn Report Abuse Drill here now and put US citizens to work in the oil and gas industries. Stop sending our money to OPEC. Get rid of Obama.
tttmikeb All-Star Author St. Louis Posts:685 Points:209,180 Joined:Sep 2008	Message Posted: Sep 19, 2012 10:37:30 AM Ignore tttmikeb Report Abuse ok
DesertRat2011 Champion Author Riverside Posts:3,623 Points:486,780 Joined:Jun 2011	Message Posted: Sep 19, 2012 10:36:30 AM Ignore DesertRat2011 Report Abuse I don't care how it happened just as long as the price goes down :)
mitchells Champion Author Montreal Posts:3,866 Points:1,126,085 Joined:Oct 2009	Message Posted: Sep 19, 2012 10:36:21 AM Ignore mitchells Report Abuse Shows you that speculators have the run of the market
bobdec Champion Author Miami Posts:8,969 Points:1,771,545 Joined:May 2008	Message Posted: Sep 19, 2012 10:36:18 AM Ignore bobdec Report Abuse It will resume its rise soon
drobbbb Champion Author Maryland Posts:3,485 Points:813,435 Joined:Dec 2010	Message Posted: Sep 19, 2012 10:36:02 AM Ignore drobbbb Report Abuse how's that helping me?
bra0712 Champion Author Arizona Posts:3,670 Points:769,545 Joined:Nov 2008	Message Posted: Sep 19, 2012 10:35:24 AM Ignore bra0712 Report Abuse K
puinsai808 Champion Author Honolulu Posts:3,549 Points:728,280 Joined:May 2011	Message Posted: Sep 19, 2012 10:34:44 AM Ignore puinsai808 Report Abuse ok
BEngr Champion Author Illinois Posts:6,722 Points:1,582,115 Joined:May 2008	Message Posted: Sep 19, 2012 10:33:22 AM Ignore BEngr Report Abuse I noticed on this mornings news that oil prices are still falling. Maybe they will continue to fall more yet.
arnerator Champion Author Seattle Posts:8,189 Points:1,619,115 Joined:Sep 2008	Message Posted: Sep 19, 2012 10:33:11 AM Ignore arnerator Report Abuse I hope some speculators took a beating on that.