Oil ETC performance started the quarter poorly with the Brent oil spot price dropping to a low of $40/bbl at one point.
However, as global cyclical indicators improved in the latter part of the quarter and OPEC cut more than expected, oil prices rebounded strongly, with the spot Brent oil price ending the quarter around $50/bbl. ETFS Brent 1mth (OILB), after falling by 10% in the Jan-Feb period, rebounded by 14% in March.
Follow Commodity Online on Twitter As a result, oil ETCs also saw strong interest, with quarterly flows into long oil ETCs rising by a record $916mn in 1Q09, a 160% increase (2.6x) compared to inflows during 4Q08. At the end of 1Q 2009 assets in long oil ETC stood at $1.3bn, their highest level on record.
The largest inflows were into ETFS Brent 1mth (OILB), ETFS WTI 2mths (OILW) and ETFS Crude Oil (CRUD) with interest in longer-dated oil ETCs such as ETFS Brent 1yr (OSB1) picking up strongly towards the end of the quarter.
ETFS Gasoline (UGAS) was the best performing ETC within the energy sector, rising by 19% in 1Q09 as falling supply and better than expected demand towards the end of the quarter caused prices to rise sharply.
Courtesy: ETF Securities Ltd
