NEW YORK (Reuters)- For the small club of companies who trade the food, fuels and metals that keep the world running, the last decade has been sensational. Driven by the rise of Brazil, China, India and other fast-growing economies, the global commodities boom has turbocharged profits at the world’s biggest trading houses.

They form an exclusive group, whose loosely regulated members are often based in such tax havens as Switzerland. Together, they are worth over a trillion dollars in annual revenue and control more than half the world’s freely traded commodities. The top five piled up $629 billion in revenues last year, just below the global top five financial companies and more than the combined sales of leading players in tech or telecoms. Many amass speculative positions worth billions in raw goods, or hoard commodities in warehouses and super-tankers during periods of tight supply.

U.S. and European regulators are cracking down on big banks and hedge funds that speculate in raw goods, but trading firms remain largely untouched. Many are unlisted or family run, and because they trade physical goods are largely impervious to financial regulators. Outside the commodities business, many of these quiet giants who broker the world’s basic goods are little known.

Their reach is expanding. Big trading firms now own a growing number of the mines that produce many of our commodities, the ships and pipelines that carry them, and the warehouses, silos and ports where they are stored. With their connections and inside knowledge — commodities markets are mostly free of insider-trading restrictions — trading houses have become power brokers, especially in fast-developing Asia, Latin America and Africa. They are part of the food chain, yet help shape it, and the personal rewards can be huge. “The payout percentage of profits at the commodities houses can be double what Wall Street banks pay,” says George Stein of New York headhunting firm Commodity Talent.

Switzerland-based Glencore, whose initial public offering (IPO) in May put trading houses in the spotlight, pays some traders yearly bonuses in the tens of millions. On paper, the partial float made boss Ivan Glasenberg $10 billion richer overnight.

SIZE MATTERS

How big are the biggest trading houses? Put it this way: two of them, Vitol and Trafigura, sold a combined 8.1 million barrels a day of oil last year. That’s equal to the combined oil exports of Saudi Arabia and Venezuela.

NEW YORK (Reuters) – At $93 a barrel, U.S. oil prices traded on Tuesday within a well-worn range. But that belies a radical move in energy markets this week — the unraveling of one of the hottest and most volatile oil trades in years.

The trade-gone-haywire is known as the Brent-WTI spread bet, a wager on the relative value between the two most-traded oil futures in the world, London’s Brent and U.S.-traded West Texas Intermediate.

While the light, sweet crudes are equally prized by refiners, Brent’s premium to WTI grew steadily wider over the course of this year, moving from parity to a record $28 a barrel two weeks ago. The large divergence once seemed unthinkable, since barrels of oil are usually relatively cheap to transport between regions.

In recent days, the spread has been collapsing as WTI prices rise and Brent falls. Since Friday, Brent’s advantage has slipped from $22 a barrel to $18, and oil market insiders have been stunned by the recoil.

Since billions ride on the spread, its recent narrowing means that investors caught wrong-footed — those betting long Brent and short WTI — have likely been bleeding cash.

Traders and analysts speculated there could be a major money-loser among the hedge funds, investment banks and deep-pocketed trading houses, but none could be identified.

“I’m sure a lot of the big energy funds got waylaid with this,” said money manager John Stephenson at First Asset Management in Toronto, with $2.7 billion under management.

NEW YORK (Reuters)- For the small club of companies who trade the food, fuels and metals that keep the world running, the last decade has been sensational. Driven by the rise of Brazil, China, India and other fast-growing economies, the global commodities boom has turbocharged profits at the world’s biggest trading houses.

They form an exclusive group, whose loosely regulated members are often based in such tax havens as Switzerland. Together, they are worth over a trillion dollars in annual revenue and control more than half the world’s freely traded commodities. The top five piled up $629 billion in revenues last year, just below the global top five financial companies and more than the combined sales of leading players in tech or telecoms. Many amass speculative positions worth billions in raw goods, or hoard commodities in warehouses and super-tankers during periods of tight supply.

U.S. and European regulators are cracking down on big banks and hedge funds that speculate in raw goods, but trading firms remain largely untouched. Many are unlisted or family run, and because they trade physical goods are largely impervious to financial regulators. Outside the commodities business, many of these quiet giants who broker the world’s basic goods are little known.

Their reach is expanding. Big trading firms now own a growing number of the mines that produce many of our commodities, the ships and pipelines that carry them, and the warehouses, silos and ports where they are stored. With their connections and inside knowledge — commodities markets are mostly free of insider-trading restrictions — trading houses have become power brokers, especially in fast-developing Asia, Latin America and Africa. They are part of the food chain, yet help shape it, and the personal rewards can be huge. “The payout percentage of profits at the commodities houses can be double what Wall Street banks pay,” says George Stein of New York headhunting firm Commodity Talent.

Switzerland-based Glencore, whose initial public offering (IPO) in May put trading houses in the spotlight, pays some traders yearly bonuses in the tens of millions. On paper, the partial float made boss Ivan Glasenberg $10 billion richer overnight.

SIZE MATTERS

How big are the biggest trading houses? Put it this way: two of them, Vitol and Trafigura, sold a combined 8.1 million barrels a day of oil last year. That’s equal to the combined oil exports of Saudi Arabia and Venezuela.

NEW YORK, Oct 21 (Reuters)- For the small club of companies who trade the food, fuels and metals that keep the world running, the last decade has been sensational. Driven by the rise of Brazil, China, India and other fast-growing economies, the global commodities boom has turbocharged profits at the world’s biggest trading houses.

They form an exclusive group, whose loosely regulated members are often based in such tax havens as Switzerland. Together, they are worth over a trillion dollars in annual revenue and control more than half the world’s freely traded commodities. The top five piled up $629 billion in revenues last year, just below the global top five financial companies and more than the combined sales of leading players in tech or telecoms. Many amass speculative positions worth billions in raw goods, or hoard commodities in warehouses and super-tankers during periods of tight supply.

U.S. and European regulators are cracking down on big banks and hedge funds that speculate in raw goods, but trading firms remain largely untouched. Many are unlisted or family run, and because they trade physical goods are largely impervious to financial regulators. Outside the commodities business, many of these quiet giants who broker the world’s basic goods are little known.

Their reach is expanding. Big trading firms now own a growing number of the mines that produce many of our commodities, the ships and pipelines that carry them, and the warehouses, silos and ports where they are stored. With their connections and inside knowledge — commodities markets are mostly free of insider-trading restrictions — trading houses have become power brokers, especially in fast-developing Asia, Latin America and Africa. They are part of the food chain, yet help shape it, and the personal rewards can be huge. “The payout percentage of profits at the commodities houses can be double what Wall Street banks pay,” says George Stein of New York headhunting firm Commodity Talent.

Switzerland-based Glencore, whose initial public offering (IPO) in May put trading houses in the spotlight, pays some traders yearly bonuses in the tens of millions. On paper, the partial float made boss Ivan Glasenberg $10 billion richer overnight.

SIZE MATTERS

How big are the biggest trading houses? Put it this way: two of them, Vitol and Trafigura, sold a combined 8.1 million barrels a day of oil last year. That’s equal to the combined oil exports of Saudi Arabia and Venezuela.

NEW YORK (Reuters) – Brazil’s richest man said on Friday he has abandoned talks to sell stakes in his offshore oil prospects, which had drawn interest from China, because he already has billions in cash on hand.

Eike Batista’s flagship oil company OGX had been in talks with companies including oil firms from China, but no longer sees any need to sell because a $2.6 billion bond issue earlier this year left it flush, he said in a three-hour interview at Reuters’ headquarters.

Batista also said OGX was close to signing a long-term supply deal to export part of its oil production to one of the world’s largest oil refiners, without naming the company.

“The bond issue, which was spectacular, completely covered the need for cash,” Batista said in an interview. “We brought in exactly what we needed to live off our own spoils.”

Batista, valued by Forbes at near $30 billion, struck a defiant tone in the face of a quickly worsening global economy, saying his companies ran “idiot-proof” projects that could withstand a sharp drop in commodities prices.

He said he saw “zero” risk that a slower economy could thwart his companies’ efforts to raise capital for their estimated $50 billion in planned investment.

“I have to laugh,” he said when asked whether he was worried about the recent plunge in the share prices of his companies. “My companies are all going to be massive cash flow machines, I’m going to pump money to my shareholders and dividends to my sons and my grandsons.”

SAO PAULO/NEW YORK (Reuters) – Brazil’s central bank unexpectedly acted to halt the currency’s slide on Thursday, highlighting growing concern among officials that the global financial crisis is damaging Brazil’s economy and could cause a potentially destructive spurt in inflation.

The bank’s decision to sell $2.75 billion in currency swaps — a move that propped up the real — marked a sudden shift in strategy for a government that has complained for the past year about a “currency war” that left the real badly overvalued compared to its neighbors.

Yet, the real’s massive and sudden depreciation, which has pushed it down 17 percent against the U.S. dollar this month to levels not seen in two years, was apparently too much for the central bank to bear.

President Dilma Rousseff, speaking while on a trip in New York, said that Brazil’s economy is well-equipped to face the global crisis but added that the government was prepared to take additional measures to prevent further abrupt moves in the currency.

“I think things are going to stabilize, but we are ready” to take more measures if necessary, she said.

A member of the government’s economic team told Reuters that officials are concerned about the impact of the falling real on inflation, which is already well above the government’s target range. A weaker real may cause the prices of imported goods to rise, although the official also said that the depressive effects of the global crisis should keep a lid on inflation.

Brazil is in many ways a victim of the crisis, which is centered in Europe and the United States and has punished currencies in several emerging markets as investors seek refuge in the safe haven of the U.S. dollar.

NEW YORK (Reuters) – Oil prices ended lower on Wednesday after the U.S. Federal Reserve said the economic outlook remained grim, which overshadowed an unexpectedly steep drop in crude supplies in the world’s top oil consumer.

Brent for November delivery fell 18 cents a barrel to settle at $110.36, after topping $112 earlier. U.S. crude settled $1.00 lower at $85.92 a barrel after rising as high as $87.99.

Oil prices had risen in earlier trade after government data showed U.S. crude inventories last week dropped 7.3 million barrels, the biggest one-week drop since December, suggesting supplies were tighter than expected.

But the market turned bearish after the Fed said it would extend the maturity of its treasury holdings but didn’t unveil more aggressive measures to boost a U.S. economy it said faces “significant downside risks”.

The Fed plans to extend the maturity of its treasuries, buying $400 billion in long-term notes, while selling an equal amount of bonds maturing in three years or less by mid-2012, the central bank’s market committee said.

The Fed said it discussed a variety of other “policy tools” it could use to promote stronger economic growth, but its statement stopped short of announcing any more measures.

Previous efforts by the Fed to stimulate a flagging U.S. economy have resulted in more buying of risk assets including commodities and equities, but some analysts said the Fed’s latest plans aren’t aggressive enough to warrant that.

NEW YORK (Reuters) – Brent crude rose above $112 a barrel on Wednesday after U.S. crude inventories dropped by the most in nine months last week, suggesting supplies are tighter than expected in the world’s top oil consumer.

U.S. crude inventories fell by 7.34 million barrels in the week to September 16, the biggest one-week drop since December, after U.S. crude imports fell and refiners unexpectedly boosted their crude processing rates, according to data from the U.S. Energy Information Administration. Analysts polled by Reuters had expected a smaller drawdown of 700,000 barrels. <EIA/S>

Brent crude for November delivery rose $1.50 a barrel to $112.04 as of 12:15 p.m. EDT (1615 GMT), extending gains following the release of EIA data. U.S. crude rose by 60 cents to $87.51 a barrel, reversing losses earlier in the day.

“The (EIA) report was bullish. The plunge in crude oil inventories gives the market the sense that supplies are tight,” said John Kilduff of New York hedge fund Again Capital LLC.

Oil traders also awaited a U.S. Federal Reserve policy statement expected to include measures to support the economy, and due for release at 2:15 p.m. EDT.

The Fed is expected to announce plans to intervene in the bond market to push long-term interest rates, already near historic lows, even lower.

Stimulus measures could make it easier to borrow cheap dollars for longer periods, potentially feeding investment inflows into crude oil and other commodities considered risk assets.

NEW YORK (Reuters) – Brent crude fell on Friday, reversing earlier gains, as European debt woes weakened the euro and a U.S. consumer outlook fell to a 31-year low.

The dollar firmed, making oil more expensive for holders of foreign currencies. The euro came under pressure on speculation that debt-laden Italy may have its sovereign rating downgraded, just as Greece finalizes plans to restructure its own debt payments. <USD/>

Brent crude for November fell 3 cents to $112.27 a barrel by 12:35 p.m. EDT. Europe’s benchmark crude had risen above $114 a barrel in earlier trading.

U.S. crude took a bigger fall, dropping $1.41 a barrel to $87.99. A Thomson Reuters/University of Michigan survey of U.S. Consumers’ preliminary September consumer sentiment rose slightly, but consumers’ outlook for the future fell to the lowest since 1980.

“Oil investors have to be getting worried about global demand going forward, and the risk of contagion in Europe from Greece to other economies,” said Richard Ilczyszyn of MF Global in Chicago.

Brent’s losses trailed those of U.S. crude as the European contract switched to a new front-month, November, and investors bet it would gain in value versus later months on tight prompt supply of North Sea crudes.

Brent for November traded on Friday at a $24.18 a barrel premium to West Texas Intermediate for the same month. The spread had closed at $22.71 on Thursday.

NEW YORK (Reuters) – It might not sound like much of a victory. The United States and other oil consuming countries release emergency stocks of oil to put a lid on prices. The result: oil prices in London rise by $1 since the program began, three months ago.

But many oil experts say the strategic releases — just the third-ever by a group of consumer countries — were a major success. Not only did they likely avert a further rise in oil prices during the peak U.S. driving season, but they set a precedent for consuming countries to keep bullish oil speculators in check.

“The recent IEA releases completely changed the psychology of the oil market,” said Amy Jaffe, an energy policy expert at Rice University’s Baker Institute in Houston.

“The move worked, as it has in the past, because speculators now have to worry that extra oil may come if prices reach a certain level. It showed they are willing to use the strategic reserves.”

The program to release 60 million barrels by the 28-nation International Energy Agency, which formally ended on Thursday, was first announced on June 23, when it set off an immediate drop of $7 a barrel in Brent crude prices.

The program, heavily lobbied for by the U.S. government, was controversial, with lots of oil market players deriding it as a political move to appease testy consumers, after U.S. gasoline prices rose to near $4.00 a gallon in May.

IEA’s extra oil supplies may have helped accelerate a 22 percent slide in U.S. oil prices from 30-month highs near $115 in early May. U.S. crude traded below $90 on Thursday.