Trading crude oil has certainly been entertaining in the past decade or so and this year has not been different. Wild unpredictable swings, tons of volume, volatility, global economic uncertainty and unpredictable elements almost every single day… they all come together to form the trader’s dream. Even though oil has generally been down so far this year (see the graph just below), there have been numerous opportunities to make money off of the black gold.

And as tragic as the recent BP oil spill has been, it has provided some trading opportunities. It is unclear how damaged BP will come out of this public and ecological disaster. BP has lost 20% more this year than most of its big peers. Is that too much? Its difficult to say of course with the penalties still very much undetermined. But there are possibilities.

Another possible trade is the strong hurricane possibility. The hurricane season is now a few weeks away and the could very much be what is needed to take oil back over 100$.

Historically, crude oil has always been very volatile but had started to seriously take off in the past few years as demand from China, other emerging markets as well as a lot of speculative flows made their way into the crude oil market. It’s unclear how much of it was justified but it’s safe to say that probably none of us expect oil to return to 40$ in the near future. Oil continues to be cheap because of the deep world recession but just look at this graph from Wtrg.com and you will remember exactly how high oil had gone before the economy tumbled:

So let’s start off with a general chart of the price of Crude Oil, in 2010:

As you can see, Crude Oil is clearly down and certainly the trend is towards more losses… The question of course is for how long it can keep up.  Let’s start off by looking at the Top Oil ETF’s and how they are doing so far in 2010:

Not a huge surprise to see that short ETF’s have been at the top, especially considering the rapid decline since the start of May

Next up, we will take a look at the large caps which right now in the world of oil reminds us of how painful things have been for BP. Just take a look at this year’s chart for the British company:

And now here are the Top large cap oil companies, as you can see while BP has taken quite a hit, it’s not the worst so far in terms of returns, surprisingly:

As you know, in the commodities world, the largest companies are rarely the Top performers, so here are the top ones so far this year among the top 500 Oil companies:

And finally, just in case you are serious, the worst performers.. this might help BP feel a little better…

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