By Brad Zigler

Halloween's approaching, and with it comes the prospect of tricks and treats for oil market traders. For traders plying the "crack spread," one of the market's tricks actually turns out to be more of a treat.

Denver-based United States Commodity Funds has launched another exchange-traded commodity product, its first to offer inverse exposure to commodity prices. The United States Short Oil Fund (DNO) began trading this week on the NYSE Arca Exchange. DNO is the sixth product from United States Commodity funds, joining products offering exposure to crude oil (USO), natural gas (UNG), 12-month oil (USL), gasoline (UGA), and heating oil (UHN).

DNO will seek to track the inverse of the spot price of light, sweet crude oil delivered to Cushing, Oklahoma, as measured by the price of futures contracts on the commoidty. The fund will invest in near month futures contracts, except when the near month contract is within two weeks of expiration, in which case it will invest in the next month’s contract.

By Brad Zigler

Real-time Monetary Inflation (per annum): 4.3%*

A year or two ago, oil companies were easy targets for consumer opprobrium. Record profits were scored by the majors while drivers were left steaming at the pump over ever-rising prices.

By Brad Zigler

Real-time Monetary Inflation (per annum): 4.2%*

Pretty soon, it'll be time for savvy oil traders to consider "crack spreads." This bone-crushing moniker refers to the refining of crude oil into primary distillate fuels such as gasoline and heating oil. The spread refers to the profit margin obtained from distillates' sale proceeds after paying for raw ingredient crude oil. This margin can be simulated by selling (paying for) crude oil futures and simultaneously purchasing (obtaining the sale price for) heating oil and gasoline futures.

An interesting slideshow here via CNBC.com showing the 10 best performing commodities year to date; what I like about this is it shows not just the physical commodity, but the ETF that most closely links to said commodity - and the difference in performance between the physical and ETF.

Keep in mind some ETFs are quite imperfect, and there has been a lot of fuss about the Natural Gas ETF (UNG) which some believe is now getting so big it is actually moving the physical market. There was somewhat similar problems last year in the most popular agriculture ETF [Mar 4, 2008: IndexUniverse.com - DBA is "Full-Up"]. I am all for "innovation" but when we start creating Frankenstein products which affect normal supply and demand, it appears we've gone too far. Oh well, all products are now just here to be speculated on and make "mad money" - supply and demand is so 1980s. [Feb 12, 2008: Wheat is Being Ruined by ... what else... Hedge Funds and Speculators]

Oil prices peaked at around $147 a barrel on July 11, 2008. We are now about 11 months after that bubble burst, and Oil has recently climbed as high as $70 a barrel. A scan of the best and worst performing ETFs over a 52 week time frame (excluding Ultra and Short ETFs) shows the damage that has been seen in the Energy Sector since that time.

On the Worst Performers list below, you can see 3 directly related Energy ETFs, all down 56%+ over the past 52 weeks: Natural Gas (UNG), Crude Oil (USO), and Heating Oil (UHN). Interestingly enough, an "alternative energy" ETF that is involved in Solar stocks (TAN) is also down over 56%.

By Brad Zigler

Each week, we comment on the U.S. Department of Energy reports of crude oil and fuel inventories (see our last commentary, "Got Gas? There's Less Now"). As part of our commentary, we depict potential profit margins that oil refiners can obtain by "cracking" crude oil into its major tradable distillates: gasoline and heating oil. This so-called "crack spread" represents the dollars earned, above the cost of crude oil inputs, by selling wholesale lots of refined products.

By Brad Zigler

Crude oil closed lower on Tuesday, ahead of the U.S. Energy Department's weekly inventory report, widening crack spreads to levels not seen since January. Overnight, crude prices recovered slightly on short covering as traders seemed to heed analysts' forecast for a 2.8-million-barrel decline in domestic crude oil stocks. They needn't have bothered, though. The Energy Department, it turns out, reported oil stocks growing by 4.7 million barrels last week.

By Brad Zigler

The virulent crude oil contango that's been both revered and reviled – depending upon your market stance – was halved Tuesday, a signal that inventories may be being drawn down rather than built up.

By Brad Zigler

This is not just any market. But you already knew that, right?

When oil falls on the prospect of throttled-down supply, the world must be topsy-turvy.

To figure out where commodities are going, the main questions that need to be answered are: what type of demand will come out of China and where is the US dollar going? Is the Chinese driven commodity boom over? Not over, but expect a significant slowdown. The Chinese government said that exports were down 2.2% in November from a year ago, the first decline in seven years. Imports were down almost 18%. Over the next few months commodity investors will need to closely monitor China’s economy. In terms of the dollar, after an 18% rally from mid September we have seen the dollar fold 6.5% in the last 3 weeks. We are betting that an interim top has been made and we will see a re-visit of the 75 level before we see 90 in the US dollar index. This should bode well for commodities that are priced in dollars. Deeper than that though, weakness in the US dollar should signal a modest stabilization for the global financial system as investors are becoming more willing to take some risks. Investors will remain skittish for months to come, but as the central banks race to zero, investor’s will look for other homes for their capital.

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Many of our readers at AboutETFs.com enjoyed our earlier article The Complete List of Currency ETFs and have been requesting a similar list for commodities. So, once again, by popular demand, here is our newest list, The Complete List of Commodity ETFs and ETNs, as of October 20, 2008.

COMMODITY BASKETS (All Commodities)

By Brad Zigler

Real-time Inflation Indicator (per annum): 7.9%

According to the U.S. Energy Department's weekly inventory report, domestic crude oil supplies increased 7.3 million barrels last week, far exceeding the forecast for a 900,000-barrel build made by Oil Patch analysts. Traders opened the NYMEX futures floor session 3.4% higher ahead of the report, following a 6.7% decline on Tuesday. The United States Oil Fund (AMEX: USO), an exchange-traded portfolio that tracks oil futures, fell $2.77 in lockstep to finish at $41.36.

These tables show the 1-week, 4-week, 13-week, 26-week and 52-week returns for a wide spectrum of asset types.

They, and other tables, are updated each Saturday morning on our site. These tables are for the week ended November 21, 2008.

By Matthew Hougan

The weather turned cold in Maine today, and that has me thinking about two things: heating oil and ETFs.

By Brad Zigler

Normally, Wednesday's column is devoted to gauging the ability of Oil Patch analysts to handicap the weekly Energy Information Administration inventory reports. Well, the analysts have their numbers ready, but the Feds don't. The Veterans Day holiday set the gum'mint guys a day behind, so we won't see the oil and product stockpile numbers ‘til Thursday.