An interesting thing happened while oil climbed past $100 barrel.
Suddenly oil, like most commodities, became the new red hot business to chase. People who previously would have joined investment banks, chased dot.com startups or traded bonds are now trying to tack their Harvard and University of Chicago MBA sheepskins to the world's trading benches.
But will these well pedigreed traders be able to push the old school traders aside?
Hurricane Gustav's appearance indicated a changing of the guard will not be coming any time soon.
Gustav's steady march through the Caribbean towards the Gulf of Mexico in the waning days of August brought the old-school traders out of the wood work and proved that a dinosaur's know-how can still work the fossil fuels better than an excel spreadsheet.
Gustav's assault on Hispaniola Island managed to push the whole distillate market higher from Monday to Tuesday. Was the market poised to pop?
"The young punks puke early," said one long time trader. "This thing is miles out there. Trading when a storm is coming is like being in a gunfight and shooting wildly in the general direction of your opponent before you're in range. Then, the slow and steady hand picks you off by shooting you in the head."
The Barrel is still not entirely sure what that means. But if he was implying the market was over-hyped early on and the rally was premature, it appears he was correct.
USGC product cash market began a correction Wednesday that trended into Thursday morning with all distillate differentials (except Ultra Low Sulfur Diesel) pushed under Tuesday's peak values.
Or, as yet another colorful longtime oil trading fixture said:
"The market is going to come off like the glide slope of a greased crow bar."
That's the sort of old school color commentating they don't teach in business school and is never found on an Excel spreadsheet.
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