Oil news: The hacienda hedge is said to be underway
Mexico said to start selling its oil
Mexico is probably the world largest user of futures for the purpose of hedging. Each year, officials at Mexico's Minister of Finance sell billions of dollars worth of oil futures contracts in order to lock in oil prices.
It's done over months and it works better if they maintain secrecy but it's such a huge order and word has got out that they've begun to sell. Bloomberg is out with the story.
Last year they sold contracts to guarantee a prices of $46 per barrel and obvious would have been better off (in hindsight) by not hedging at all.
They are now looking to lock in 2019 prices and with crude at $71, they are undoubtedly getting a better price.
The hedge is likely the world's largest oil trade and covers 200-300 million barrels of oil. It could be a catalyst for some selling oil.