West Texas Intermediate (WTI) light sweet crude oil for January delivery settled at $100.14 a barrel, up $2.37, and February Brent futures were up $1.89 to $108.97, despite a stronger dollar and pullback of equities in afternoon trading. Oil typically trades inversely to the U.S. dollar and complementary to the S&P 500.
"You would expect prices to the move other way -- so that's atypical," said Jacob Correll, an energy analyst at Schneider Electric's Summit Energy.
WTI futures had spiked to $101.25 at around 9:51 am."The increase came so fast," said Correll. The trigger to the big spike was attributed to a raft of algorithmic trades set off by rumors that Iran was closing down the Strait of Hormuz, where about one-third of the world's seaborne oil traffic takes place -- for war games. There were also reports of a ship collision in the Houston ship channel -- another important oil conduit -- which sparked concerns about traffic congestion. "The whole move happened within 15 minutes," says Tradition Energy's senior market research director Addison Armstrong. "There was a large volume spike.
>To contact the writer of this article, click here: Andrea Tse.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV