Rebirth of the Hong Kong Millennium Conglomerate

Chapter 83 Futures Delivery

In the winter of 1973, the biting wind, carrying the moisture of the Atlantic Ocean, swept over the skyscrapers of New York and London, but could not dispel the scorching heat in the futures trading halls of the two financial capitals.

At that time, the entire futures market in the UK and the US had already fallen into an unprecedented frenzy.

The trigger was a bombshell announcement from the heart of the Middle East—Arab oil-producing nations swiftly declared a complete ban on oil exports.

The news was like a boulder crashing into the already turbulent global capital markets, instantly creating a huge wave of activity.

Capital's sense of smell is always more acute than the sharpest hunting dogs; in their eyes, this ban is nothing short of a bloody signal.

In an instant, countless funds, like sharks smelling blood, swarmed toward crude oil futures.

Inside the trading floor of the New York Mercantile Exchange, brokers dressed in colorful trading vests crowded together, waving their trading orders, veins bulging on their necks, their shouts, yells, and ringing telephones creating a chaotic symphony.

On the electronic price display, the crude oil futures price numbers jumped upwards at an almost out-of-control speed, each refresh triggering an even more violent commotion. The red upward arrows, like wildfire, burned into the eyes of every trader.

"$5.20! It's gone up again! I'm going to add another 100,000 barrels!" A blond broker slammed the trading order on the counter, his voice hoarse but filled with desperate excitement.

"Don't be silly! Prices will only go up! As long as the Middle East doesn't lift the ban, oil prices won't stop!" someone shouted in rebuttal, his calculator clicking away, his eyes filled with a fanatical desire for wealth.

The atmosphere at the London International Petroleum Exchange is less flamboyant than in New York, but more tense and turbulent.

The traders, dressed in sharp suits, stood at their respective seats, rapidly reporting prices and positions into their phones, their expressions shifting with the fluctuating price charts.

Even the usually composed and prudent representatives from established investment banks abandoned their composure at this moment, constantly raising their buy limits, fearing that if they were a step behind, they would miss this once-in-a-lifetime wealth feast.

Crude oil prices, like a runaway horse, have surged at an astonishing speed.

Some people are trying to use rational analysis to see if this surge is coming to an end. After all, in recent years, new oil fields have been explored and developed around the world, and the oil and gas fields in the North Sea and the shale oil in the Americas are gradually diverting market share from Middle Eastern oil.

But everyone knows that even with the continuous emergence of new oil fields, the Middle East remains the undisputed global oil exporter, and its production and reserves occupy a pivotal position in the international energy landscape.

Now that this "world's oil depot" has suddenly closed its export gates, a huge gap has instantly appeared in the global oil supply chain. Panic has spread like a virus, directly pushing crude oil futures prices to a crazy peak.

From the moment the ban was announced, crude oil futures prices began to surge.

In the first few trading days, the price rose steadily, but once the market had fully digested the panic over the "oil shortage," the pace of the rise suddenly accelerated.

$3, $5, $8 — one key level after another was easily breached, and there was no sign of stopping.

Analysts at the exchange have repeatedly defied their conservative forecasts and have had to revise their expectations upwards time and again. Some have even boldly asserted that it is only a matter of time before oil prices break through $15 per barrel.

While the entire UK and US futures markets were in a frenzy, with countless investors recklessly chasing high prices, only Qian Gu Bank was going against the tide, acting methodically.

Months ago, under Zhang Zeyang's instructions, Qian Gu Bank quietly began to buy 10 billion barrels of crude oil futures contracts at a low price of $2.8 per barrel.

Now that oil prices have reached their peak, Zhang Zeyang's order to liquidate all holdings has long since become Li Bin's operational guide.

Li Bin himself was well aware that this clearance sale could not tolerate the slightest mistake.

He personally oversaw the operation, dividing the core trading team into three shifts to closely monitor the trading sessions in New York and London.

"Sell in batches, five million barrels each time, with the order price $0.1 lower than the current market price, to ensure quick transactions without causing market panic," Li Bin instructed over the phone.

On the trading screens of the British and American stock exchanges, these sell orders were like fine sand thrown into a torrent, silently swallowed up by the surging buy orders, without alerting the market at all.

After all, with oil prices soaring, countless funds chasing the highs are eagerly awaiting their return, and a mere few million barrels of sell orders are just a drop in the ocean.

Li Bin's strategy is to "influence things subtly and gradually." He is not in a hurry to clear out his entire position at once, so as not to trigger a price collapse.

They don't greedily wait for the so-called "highest point," but rather steadily realize profits during the peak of the upward trend.

Sometimes, he would stare at the market screen for hours on end until he saw the buying power weaken slightly, at which point he would decisively stop selling; when the market once again saw a surge in buying at higher prices, he would order the release of another batch of positions.

Time slipped away quietly amidst this tense yet orderly operation.

A little over a month passed in the blink of an eye. When the last futures contract of 500 million barrels was successfully executed at a price of $11.5 per barrel, everyone in the trading center couldn't help but breathe a sigh of relief.

Li Bin leaned back in his chair, rubbed his aching temples, and finally a relieved smile appeared on his face. This clearance sale, which lasted for more than a month, had finally come to a perfect end.

He got up, carefully organized the thick stack of transaction reports, and stuffed them into his briefcase.

He then drove to the Repulse Bay villa to report.

A tranquil and pleasant afternoon at Repulse Bay. Sunlight filters through the dense palm leaves, casting dappled shadows, while the salty sea breeze caresses the lawn in the courtyard.

Compared to the hustle and bustle of the financial markets, this place seems like another world.

As soon as Li Bin's car came to a stop, the villa's butler greeted him with a smile: "Mr. Li, Mr. Zhang is already waiting for you in the study."

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Li Bin nodded, straightened his suit collar, and stepped into the villa. He walked through the living room, which was covered with a Persian carpet, and went upstairs to Zhang Zeyang's study.

Zhang Zeyang was sitting at a mahogany desk by the window, holding a cup of hot tea in his hand, gazing at the blue sea and sky outside the window, looking relaxed.

"Mr. Zhang," Li Bin greeted respectfully.

Zhang Zeyang turned around, pointed to the chair opposite the desk, and smiled slightly: "You're here? Have a seat. The clearance sale should be done by now."

Li Bin sat down as instructed, placed his briefcase on the table, opened it, took out the transaction report, and handed it over with both hands: "Everything is done. Here is the detailed transaction report; please take a look."

Zhang Zeyang took the report but didn't look at it immediately. He simply placed it beside him and said calmly, "Just tell me verbally. I'm listening."

"Okay." Li Bin composed himself and began his report: "Our Qian Gu Bank holds a total of 10 billion barrels of crude oil futures contracts this time. The initial purchase price was $2.8 per barrel. Including transaction fees and capital costs, the final average holding cost is $3 per barrel."

He paused for a moment, then continued, "After you issued the order to liquidate your positions, our team sold off the shares in batches and at different times, according to the trading rhythm of the UK and US markets."

Thanks to the market frenzy, our clearance prices were very favorable, with the final average transaction price settling at 11.5.

USD/barrel.

Zhang Zeyang picked up his teacup, took a small sip, a hint of approval flashing in his eyes, but his tone remained steady: "Continue."

"Yes." Li Bin took a deep breath, his voice rising slightly. "Based on this price, our total revenue is $11.5 per barrel × 10 billion barrels, which equals $115 billion. After deducting total costs of $30 billion, the gross profit is $80 billion."

"After deducting various taxes, transaction commissions, and team bonuses, the final net profit," Li Bin paused, then said, word by word, "was exactly $61.5 billion."

$61 billion!

Even Zhang Zeyang, who had already anticipated the outcome, couldn't help but nod slightly upon hearing these words, his eyes showing even greater approval.

Li Bin then added, "Based on the current exchange rate of US dollars to Hong Kong dollars, with 1 US dollar being approximately equal to 5.6 Hong Kong dollars, 61 billion US dollars is roughly equivalent to 344 billion Hong Kong dollars!"

HK$344 billion!

This number was an astronomical figure in Hong Kong in 1973.

It's worth noting that Hong Kong's annual GDP at that time was only a few tens of billions of Hong Kong dollars.

This profit is almost equivalent to the annual GDP of more than half of Hong Kong.

Even those large British conglomerates that have dominated Hong Kong for many years may not have such enormous wealth.

Li Bin looked at Zhang Zeyang with admiration in his voice: "Mr. Zhang, the reason we have such a great profit this time is entirely due to your foresight and wisdom."

"If you hadn't foreseen the outbreak of the oil crisis, we would never have been able to seize this opportunity."

Zhang Zeyang put down his teacup, picked up the transaction report, and casually flipped through a few pages. The report was filled with densely packed numbers, recording the time, price, and volume of each transaction, clearly outlining the entire process.

He smiled slightly and said, "This isn't just my achievement; you and your team have done a great job. Thank you for your hard work during this time."

Upon receiving Zhang Zeyang's affirmation, Li Bin smiled with satisfaction and said, "This is all part of our duty. It is our honor to serve Mr. Zhang."

Zhang Zeyang waved his hand and said, "How about this, take a portion of the profits from this operation and distribute it among the participants. You will receive five million Hong Kong dollars, and each of the other participants will receive one million."

"This—thank you for understanding, Mr. Zhang!" Li Bin nodded quickly, his joy evident in his expression.

"Alright, if there's nothing else, you can go back and get back to work." Zhang Zeyang waved his hand.

Li Bin stood up and bowed respectfully: "Then I'll take my leave now."

After saying that, he picked up his briefcase, turned around, and left the study.

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