File 030856
Deutsche Bank Commodities Market Analysis Email to Jeffrey Epstein (File 030856)
Deutsche Bank commodities analyst email forwarding an end-of-day market analysis covering crude oil, natural gas, precious metals, and agricultural commodities dated January 8, 2015.
Summary
Daniel Sabba forwards a detailed commodities market analysis from Deutsche Bank analyst Prateek Jain to Jeffrey Epstein. The report covers January 8, 2015 market activity including crude oil price movements near $50/barrel, volatility trends in oil options, weakness in precious metals, and mixed performance across agricultural and base metal commodities. The analysis discusses OPEC pricing pressures, index rebalancing effects, and upcoming economic data releases.
From: Daniel Sabba ISent: 1/9/2015 1:53:22 AMTo: Jeffrey Epstein [jeeyacation@gmail.com]Subject: Fw: EOD Commodities Note - 8 Jan [C]Attachments: image001.jpg; image002.pngImportance: HighClassification: ConfidentialVol in crude continues to collapseFrom: Prateek JainSent: 01/08/2015 09:15 PM GMTSubject: EOD Commodities Note - 8 JanOilA relatively quiet day in Crude today. We hovered around unchanged for most of the day before selling off in theafternoon and testing 50$ BRE again. However, we failed to break it and rallied towards unchanged for the close,perhaps off the back of some index buying. Newswise, Feb Azeri BTC loadings will be up a whopping 11% m/o/m to821kbd. Interestingly, there is apparently some floating storage interest happening as well, as some major phys tradingfirms have booked long term tankers for this as long term charter rates are cheaper and thus make the economics ofstorage look good. The window was again weak with ekofisk and brent offered down a bit. In other news, RTRS cites GCC"sources" saying that there is no chance of OPEC cut even though oil has dipped to 50$...Stateside, we learned yesterdaythat the Seaway Twin is moving 100% heavy crude. Furthermore, USGC diffs weakened again, with LLS now trading 1$above WTI. In the morning WTI spreads were quite bid, but that abated towards the end of the day. The arb didhowever stay bid throughout the day, as the fact that LLS/WTI is tight at 1$ means that there is more room BRE todiscount vs LLS so as to place those Jan and Feb overhang cargoes in the US. In politics land, the Senate committee voted13-9 to have Keystone "bypass" presidential approval. So if the Senate passes this bill (which it should as it has 60 cosponsors), Obama may have to veto it. It is not clear that the Senate has 67 votes needed to overturn the veto, so thisshould be interesting to follow...In products land, distillate bounced back a bit after yesterday's post stats ugly showing,perhaps off the realization that the stats didn't add up along with the extremely cold weather giving NG a (rare) bid aswell...Oil VolsAnother day of carnage in oil vols today. Early morning NY vols were down 0.4-0.5 through the curve, but a one wayselling streak started just before the open and all the bids out there started getting hit. As an example Dec5 atmstraddles started the day 1465/1505, were 1405/1450 at 9am, and were 1350/1390 later in the day. Within 2 hours ofopen, vols were down about 3 vols across the curve..and stayed there for most of the day till about 1:30pm whenfutures took a quick leg lower., prompt vols traded 1.5% higher than close at that time and Jun5 was up 2% from thelows. However, with a quick rally back vols started fading again and ended 1.5-2.5 lower.Wings got smashed again and put skew collapsed quickly. 8000 lots of $40puts in WTI Mar15 were sold on the screen,which is quite an impressive volume outside floor trading..WTI (/change) BRE (/change)G15 50.40% -1.60% 44.00% -2.60%H15 45.50% -2.40% 43.70% -1.10%M15 41.40% -2.10% 38.20% -2.60%Z15 35.15% -1.60% 33.10% -2.15%Z16 28.60% -2.00% 28.50% -1.80%IndexNo rhyme or reason to flat price action today.HOUSE OVERSIGHT 030856Energy up, precious down, ags down, softs up, base mixed.Contributing to the choppy action was day one the SPGS and BCOM index rebalance and it was quite choppy during theclosing bell.Estimated rebalance numbers are next to today's performance grid. Only 4 more days to go......Sean Kemery+ NGG5 .2.949 +.07S +2.+ CLHS 149.33+ COHS -.27%+ XBG5 1133.98 +.22+ HOGS 1170.50 +.5: +..1)%+ QSG5 precious 1490.00 +5.00 +1.111%+ GCG5 1 -.26%+ SIHS -1.26%+ PLF5 grams+ KWH5 -1.98%+ W HS -2.16%+ C HS -.50%+ S H5 -.76%+ SMHS 1.1.92%+ BONS meats s33.76 -.6n +1.01%+ LOS &1.82%+ FCHS 11;1.83%+ LH35 softs 161.92%+ CTRS s60.56 +.13 +.22%+ SBH5 s14.88 +.10 +.(4%+ KCHS s176.90 +1.85 +%+ CCHS base s2986 +74 +2.illt+ HGHS 1276.95 +1.10 +.41YiILMCADS03 -.18$LMAHDS03 s1832.00 +42.00 +2.110LMNIDS03 s15550.00LMZSDS03 s2160.00 +27.00 +APICommodity Total 14,801WT1CrudeBrent Crude 46,197Heating Oil ULSD 6,713Unleaded Gas RBOB 12,303Natural Gas 18,340Gas Oil (13,566)Aluminum ( primary ) (16,404)Copper LME 393Copper CME (305)Nickel (4,213)Zinc (6,504)Lead 484Gold (7,599)Silver 2,671 _Wheat (10,993)Wheat(HRW- Hard red i.vinter) (2,921)Cocoa 204Coffee 'C' (17,223)Corn 118,6251Cotton No.2 4,515Soybean 5,065Sugar (8,1651Soy Meal 1,917Soy Oil (2,2281Feeder Cattle 1,064Live Cattle (14,602)bean Hog (2,759)Base Metals dod change support resistance3m IvlsAl $1832 +$42 $1800 $1900Cu $6101 -$11 $6000 $6200Zn $2160 +$27 $2125 $2200Ni $15,550 +$0 $15,000 $15,650Pb $1851 +$1 $1830 $1900The base complex was up in the morning, with most metals rallying around 12:30, retracing in the afternoon thenrallying to the close. Gains in stock markets, Fed confidence in the US economy and the increasing likelihood ofaggressive stimulus in Europe are holding up the complex, but the re-wieghting of commodity indexes is likely to resultin a sell off in Nickel Ali and Zinc between 8-14 Jan. Aluminium prices recovered as shorts were covered. Commerzbankexpects to see a further rebound in coming days.Copper prices are suffering due to the sell off in the energyHOUSE OVERSIGHT 030857market. Nitaxis sees the Chinese Stare Reserve Bureau cutting its purchases from 600-700 kMT in 2014 to —300 kMT in2015 as domestic supply catches up with demand. Zinc open interest is looking very high leading Macquarie to suggestthat prices may be going down this quarter.Shanghai Aluminium on warrant stocks are down 3.52% to 46.9 kMT. LME Aluminium on warrant stocks are flat at1852.2 kMT. Shanghai Copper on warrant stocks are up 0.97% to 31.1 kMT. LME Copper stocks are up 0.67% to 155.1kMT. LME Nickel stocks are down 1.21% to 324.4 kMT.Copper Vols are up 0.28% in the front, Ali Vols unch, Nickel Vols are unch in the front, up 0.27% in the back, Lead andZinc Vols unchUpcoming Data8/1- EC Consumer Confidence-Sury -10.9, Actual -10.9, Prior -10.98/1- US Initial Jobless Claims-Sury 290k, Actual 294k, Prior 298kRegards,PrateekPlease access the link for disclaimer:http://globalmarkets.db.com/new/content/3045.htmlDeutsche Bank External Business Conduct Standards can be found atwww.DB.com/doddfrankThis communication may contain confidential and/or privileged information.If you are not the intended recipient (or have received this communicationin error) please notify the sender immediately and destroy thiscommunication. Any unauthorized copying, disclosure or distribution of thematerial in this communication is strictly forbidden.Deutsche Bank does not render legal or tax advice, and the informationcontained in this communication should not be regarded as such.HOUSE OVERSIGHT 030858