[joewp]

It occurred to me that I haven't checked on the NYMEX crude oil daily trading limits in a while. I did remember there used to be a $10 daily up or down limit that would stop trading for the day. In light of some of the soft commodities going limit up recently, I thought I should check on crude oil....

Guess what? There is no limit:
Light Sweet Crude Oil Contract Specs$this->bbcode_second_pass_quote('', '
')Maximum Daily Price Fluctuation
$10.00 per barrel ($10,000 per contract) for all months. If any contract is traded, bid, or offered at the limit for five minutes, trading is halted for five minutes. When trading resumes, the limit is expanded by $10.00 per barrel in either direction. If another halt were triggered, the market would continue to be expanded by $10.00 per barrel in either direction after each successive five-minute trading halt. There will be no maximum price fluctuation limits during any one trading session.

[joeltrout]

I think they are being realistic. Oil prices are a market and people should let the market work.

And yes speculation is part of markets.

joeltrout

[dorlomin]

$this->bbcode_second_pass_quote('joeltrout', 'A')nd yes speculation is part of markets.

[emersonbiggins]

$this->bbcode_second_pass_quote('joeltrout', 'I') think they are being realistic. Oil prices are a market and people should let the market work.

And yes speculation is part of markets.

joeltrout

[joeltrout]

$this->bbcode_second_pass_quote('emersonbiggins', '
')
Too bad the stock market isn't allowed the same latitude.

[heroineworshipper]

The trading limit is probably 1 quadrillion dollars, or however many dollars got printed yesterday.

[Kristen]

That's very interesting to know. Still, I think the whole commodities is rather ambiguous.

[peak]

Trading restrictions are imposed to prevent a market panic. If the stock market goes up or down to much to fast then trading curbs are imposed. Trading is halted for X amount of time then resumed. This was done to prevent another black monday.

[Concerned]

$this->bbcode_second_pass_quote('peak', 'T')rading restrictions are imposed to prevent a market panic. If the stock market goes up or down to much to fast then trading curbs are imposed. Trading is halted for X amount of time then resumed. This was done to prevent another black monday.

[pup55]

In the grains, there are rather conservative limits, example: the current limit for corn is 20 cents per bushel., and in soybeans, it is 50 cents. When exceeded, trading stops basically for the day.

About last fall, and then again earlier this year, these limits were tested daily for awhile when the market went crazy and basically doubled during that time. So, this sort of thing definitely happens.

The current market situation is such that the traders (except for Phil Flynn) are looking for any excuse whatsoever to go long on crude oil. It would be really easy for this market to freak out at some point.