This is a sample entry from Brian Cullen’s email newsletter, The Cullen Outlook.
August / December CRUDE OIL spread
I am looking to take advantage of some supply and demand issues as we get past the spring months and fresh into summer.
The country will begin to USE reserves in the front months (SELL July and August) while we work to BUILD up supplies in further out months (BUY December) to be well stocked into the winter months.
SELLING the August contract
BUYING the December contract
Premium of 1.85 to the SELL side (GTC)…last trade 1.83
Risk will be the 2.15 level …($300.00)
OBJ will the 0.70 level …$1,150.00
Initial margin for this spread is $880.00 each
Have a look: