"I am pleased that someone asked about the spread between WTI and Brent crude oil prices. I didn't understand why two virtually identical products were so out of step.

"I submit this explanation from Kent Moors, which you may wish to share with your readers. I can see how a measurement difference might arise from the way Nymex arrives at its settlement price; do you think that this is another piece of politically sensitive data, like GDP, inflation and unemployment statistics in USA and perhaps other countries, that might lend itself to a different analysis? Is this an arbitrage opportunity when the heat comes off the numbers, eg after an election in 2012?"

David Fuller's view Thanks but I do not have permission to post this subscription letter and I am not sure it offers much more light on the subject.

I do not have much to add to what I said yesterday except perhaps that the spread may reflect trading battles rather than manipulation. There probably is an arbitrage opportunity but I would keep it small. Highly leveraged spread trades can go badly wrong when the norm changes, as we have seen with the WTI / Brent spread this year. I am only wondering out loud but could there be a short squeeze in Brent? If so, the premium will not last.

Meanwhile, we can expect plenty of rumours, theories and conjecture before the facts eventually trickle out. (See also yesterday's Comment.)