Rogue oil trader costs PVM $10m
03-07-2009 08:31
It's thought rogue trades which cost oil broker PVM Oil Futures almost $10m (£6m) were responsible for a spike in global oil prices to their highest in months earlier this week.
The oil broker, based in London's West End, suffered the hit on Tuesday when unauthorised trading left it with "substantial volumes" of futures contracts.
One of the firm's senior traders, Steve Perkins, has been suspended, although it's not known if the deals were deliberate or a mistake.
Oil prices topped $73 a barrel during Asian trade Tuesday, jumping over $2 for no apparent reason.
Volume reached 16m barrels in a little over half an hour, far more than normal and equal to twice the daily output of Saudi Arabia.
"When this was discovered, the positions were closed in an orderly fashion. PVM suffered a loss totalling a little under $10m," it said.
PVM has told City regulator, the Financial Services Authority (FSA), and the oil exchange, InterContinental Exchange (ICE).
The group eased concerns about its financial situation, claiming it has met all its margin calls and is conducting business as normal.
US crude settled down $2.58 at $66.73 a barrel on Thursday as poor jobless data raised concerns about the demand for oil.
A full investigation is currently underway.
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