It’s now been three weeks since a drone attacked and knocked out half of Saudi Arabia’s oil production and, if one hadn’t read the news and just casually glanced at the futures and options markets, one would never know that anything had been amiss. Oil prices (Figure 1) are smack in the middle of their recent range. The 14% up move on Monday the 16th of September looks like a blip on the long-term charts and the oil market has given up most of those gains. And why did oil rally only 14%? And why the lack of follow through in subsequent trading sessions? If half of Saudi Arabia’s oil production was knocked out, that’s ... (full story)