Nutter of a week so far

It's only Tuesday and SFOT is already feeling like a Friday, fairly drained out with dramtic happenings everywhere. First up, the famous GS vs SEC headline, taking WTI down by 2.5% on Friday and continuing the slide into Monday. One wonder why equites were down less than oil on that Friday. Does GS fighting a case for the next 2 year actually mean we lose 1 million per day or demand in oil? Then came the news that really matter, that volcano in Iceland. By now it is very well written in bloomberg and FT on the impact on Jet fuel demand. However, the move really happened on monday morning when Jet fuel prices lost almost $4 per barrel at one stage before stabilizing. At this moment, it is still unclear how are the backlog of jet fuel can be cleared and SFOT is not going to bet on that. True that there can be cash and carry opportunities or that jet can be blended with the other middle distillate pool but there can only be so much to be done. While SFOT is not entirely bearish Jet on the whole, he cannot be bullish right now and will be sitting on the sideline waiting for the physical traders to clear up the excess.
The move in WTI spreads is still on the lips of many players,, gettting in, stopping out etc. Many readers here would have felt the pain or joy no doubt. However, whhat is not pointed out is that the moved in middle distillate spreads have been even more violent, underperforming the move of crude timespreads in this downmove. The correction has been overdue, and perhaps is an overshoot. When crude spreads rallied up earlier this year, middle distillate spreads (ICE gasoil in this case) were outperforming crude but was not given a mention at all. This correction in spreads are totally led by middle distillates and the above mentioned case in Jet fuel does not help the cause. Now, would this be an opportunity for punters to get into a long middle distillate vs crude timespread trade?

Dec10-Dec11 ICE gasoil vs Ice brent timespread performance in usd/bbl


Elsewhere, in outright prices, SFOT is still targetting low 80s in CLM0 before assessing a buy level. The happy numbers from banks, in particular GS's big results today only masks the fact that UK FSA, Germany and US might be targetting more than just one bank. This surely cannot be good for equities in the short run, and certainly not financial assets like WTI?