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CNN Sunday Morning
Oil Trader Tries to Gauge Volatile Markets
Aired January 12, 2003 - 10:37 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
FREDRICKA WHITFIELD, CNN ANCHOR: You've no doubt noticed how much more you're paying at the pump these days. One reason is the higher price for crude oil charged by producing countries. OPEC members are gathering in Austria. CNN's Garrick Utley talked with one crude oil trader in New York who struggles with the ups and downs of the market while trying to make money, too.
(BEGIN VIDEOTAPE)
GARRICK UTLEY, CNN CORRESPONDENT (voice-over): Call it the human face and faces of the oil market. Traders at the New York Mercantile Exchange buying and selling future contracts of crude oil, setting the price of oil through supply and demand, news and rumors, hopes and fears of oil supplies being cut.
David Greenberg has been trading here at the pit for 16 years. What's his big worry?
DAVID GREENBERG, OIL TRADER: I know they keep saying that Venezuela is a main worry, but it is a major contributor to this market right now.
UTLEY: For five weeks, political unrest and a strike have halted the supply of two million barrels a day from Venezuela. That's a big reason why oil prices have risen as much as 25 percent since the strike began.
Back in the pit, there's suddenly other news to drive the deals that traders write down and toss in to be recorded. Saudi Arabia announces that it's ready to increase its oil production to help make up the shortfall from Venezuela.
Immediately, David Greenberg sees prices fall by 80 cents a barrel. At midday, Greenberg takes a break to find out where others think the volatile market is headed.
GREENBERG: Duane (ph), hey, it's David.
UNIDENTIFIED MALE: Yes, how are you doing?
GREENBERG: Hey. Just give me an update on what went on this morning, you know, in your mind.
UTLEY: And what would war with Iraq mean? Greenberg says that's already been calculated into today's prices. The fear of a cut in supplies is balanced by the prospect of lower prices if Iraq's full oil production is restored.
GREENBERG: It seems so logical that without Saddam there, that we'll much lower oil prices. But history showed us, you just never know.
UTLEY: You never know how a cold winter will drive up home heating oil prices. What is known is that Americans seem to accept the higher cost of the oil that fuels so much of their lives.
GREENBERG: People are used to filling up their SUVs, saying, OK, it costs $45.
UTLEY (on camera): What do you drive?
GREENBERG: I drive actually an SUV. I drive an Acura MVX (ph). But I didn't get the big, big one. I got the middle one, so I could handle, you know, not feeling too bad about it.
UTLEY (voice-over): So life at around $30 a barrel of oil goes on, for now, until something new and unknown and perhaps unknowable happens.
Garrick Utley, CNN, New York.
(END VIDEOTAPE)
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
Aired January 12, 2003 - 10:37 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
FREDRICKA WHITFIELD, CNN ANCHOR: You've no doubt noticed how much more you're paying at the pump these days. One reason is the higher price for crude oil charged by producing countries. OPEC members are gathering in Austria. CNN's Garrick Utley talked with one crude oil trader in New York who struggles with the ups and downs of the market while trying to make money, too.
(BEGIN VIDEOTAPE)
GARRICK UTLEY, CNN CORRESPONDENT (voice-over): Call it the human face and faces of the oil market. Traders at the New York Mercantile Exchange buying and selling future contracts of crude oil, setting the price of oil through supply and demand, news and rumors, hopes and fears of oil supplies being cut.
David Greenberg has been trading here at the pit for 16 years. What's his big worry?
DAVID GREENBERG, OIL TRADER: I know they keep saying that Venezuela is a main worry, but it is a major contributor to this market right now.
UTLEY: For five weeks, political unrest and a strike have halted the supply of two million barrels a day from Venezuela. That's a big reason why oil prices have risen as much as 25 percent since the strike began.
Back in the pit, there's suddenly other news to drive the deals that traders write down and toss in to be recorded. Saudi Arabia announces that it's ready to increase its oil production to help make up the shortfall from Venezuela.
Immediately, David Greenberg sees prices fall by 80 cents a barrel. At midday, Greenberg takes a break to find out where others think the volatile market is headed.
GREENBERG: Duane (ph), hey, it's David.
UNIDENTIFIED MALE: Yes, how are you doing?
GREENBERG: Hey. Just give me an update on what went on this morning, you know, in your mind.
UTLEY: And what would war with Iraq mean? Greenberg says that's already been calculated into today's prices. The fear of a cut in supplies is balanced by the prospect of lower prices if Iraq's full oil production is restored.
GREENBERG: It seems so logical that without Saddam there, that we'll much lower oil prices. But history showed us, you just never know.
UTLEY: You never know how a cold winter will drive up home heating oil prices. What is known is that Americans seem to accept the higher cost of the oil that fuels so much of their lives.
GREENBERG: People are used to filling up their SUVs, saying, OK, it costs $45.
UTLEY (on camera): What do you drive?
GREENBERG: I drive actually an SUV. I drive an Acura MVX (ph). But I didn't get the big, big one. I got the middle one, so I could handle, you know, not feeling too bad about it.
UTLEY (voice-over): So life at around $30 a barrel of oil goes on, for now, until something new and unknown and perhaps unknowable happens.
Garrick Utley, CNN, New York.
(END VIDEOTAPE)
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
