Refinery turnarounds will cut U.S. runs and we have about four weeks until we switch to September trading, going forward, the window of opportunity may not be so robust, so producers now have to pick their positions.

Refiners are systematic, because they need to lock in margin, anytime there's an uptick in a crack or a margin they're going to capitalize on it.

John Saucer

To me, it suggests that the market balances are tighter than what people have believed or generally the consensus has been in recent months.

John Saucer

Consumers have been absent from the market for a while, so that's why the back end of the curve has been so weak, they're (now) buying - and that's positive for fixed price.

John Saucer

Even if you don't necessarily think the market's bottomed, you can have a degree of confidence that we're in a much more sideways pattern, the downward momentum has dissipated and pressure is off implied volatility.

John Saucer

We're seeing sharp cuts from some producers this year in both cash and budgets, at the end of the day, the lack of hedging has come back to get them.

John Saucer

We're back below $30 and from a psychological perspective, there is a fear that we might retest lows hit earlier and that increases implied volatility.

John Saucer

There's more uncertainty now, as we approach key turning points in the market after a long downtrend.

John Saucer

Last week's build was massive, and this week's was much larger than the seasonal norm.

John Saucer

It's somewhat of a defensive posture and a reasonable posture before the beginning of the year.

John Saucer

Clearly, the decision has been made on behalf of many of these companies not to hedge or to hold off for now.

John Saucer

But they're not panicked.

John Saucer

When producers are heading into redeterminations - all of a sudden, you've done something to shore up your potential borrowing base.

John Saucer

What we're seeing now is one of the better opportunities for producers to hedge.

John Saucer

We have not seen a lot of activity in the last 24-48 hours, we saw a lot last month.

John Saucer

A lot of producers that have hedges on for 2015 are under-hedged for 2016.

John Saucer

(Costless) collars are an effective strategy that works best when prices stay within a range, but it becomes a very different animal when the market goes against that.

John Saucer

Refinery turnarounds will cut U.S. runs and we have about four weeks until we switch to September trading, going forward, the window of opportunity may not be so robust, so producers now have to pick their positions.

John Saucer

The scope of today's sell-off is unequivocally a speculative washout.

The headline on Libya was merely the trigger.

Refiners are systematic, because they need to lock in margin, anytime there's an uptick in a crack or a margin they're going to capitalize on it.

To me, it suggests that the market balances are tighter than what people have believed or generally the consensus has been in recent months.

Consumers have been absent from the market for a while, so that's why the back end of the curve has been so weak, they're (now) buying - and that's positive for fixed price.

Even if you don't necessarily think the market's bottomed, you can have a degree of confidence that we're in a much more sideways pattern, the downward momentum has dissipated and pressure is off implied volatility.

We're seeing sharp cuts from some producers this year in both cash and budgets, at the end of the day, the lack of hedging has come back to get them.

We're back below $30 and from a psychological perspective, there is a fear that we might retest lows hit earlier and that increases implied volatility.

There's more uncertainty now, as we approach key turning points in the market after a long downtrend.

Last week's build was massive, and this week's was much larger than the seasonal norm.

It's somewhat of a defensive posture and a reasonable posture before the beginning of the year.

Clearly, the decision has been made on behalf of many of these companies not to hedge or to hold off for now.

But they're not panicked.

When producers are heading into redeterminations - all of a sudden, you've done something to shore up your potential borrowing base.

What we're seeing now is one of the better opportunities for producers to hedge.

We have not seen a lot of activity in the last 24-48 hours, we saw a lot last month.

A lot of producers that have hedges on for 2015 are under-hedged for 2016.

(Costless) collars are an effective strategy that works best when prices stay within a range, but it becomes a very different animal when the market goes against that.