Collapse in Oil Curve Shows U.S. Release Has Calmed Market
(Bloomberg) Oil is still in backwardation -- a bullish market structure where near-dated...
(Bloomberg) Oil is still in backwardation -- a bullish market structure where near-dated prices are pricier than those further out -- but it’s eased to levels near where they were before Russia’s invasion of Ukraine threw the market into turmoil.
The six-month time spread for West Texas Intermediate was $6.15 a barrel at 10:17 a.m. London time on Monday, compared with $7.05 at the end of Friday and $13.46 at the close on Wednesday before the U.S. announcement. The similar spread for global benchmark Brent crude also narrowed sharply.
The redrawing of the curve indicates the market is a lot less anxious about supply shortfalls since the White House said it would release 1 million barrels a day of oil from its reserves for six months.
(Bloomberg) Oil prices have fallen to levels that don’t reflect the risk of disruptions to Russian...
(Bloomberg) Oil prices have fallen to levels that don’t reflect the risk of disruptions to Russian exports or the ability of China to keep the coronavirus pandemic under control, according to the world’s biggest independent crude trader.
“Oil feels cheaper than most would’ve predicted,” Mike Muller, Vitol Group’s head of Asia, said Sunday on a podcast produced by Dubai-based consultant and publisher Gulf Intelligence. “Oil prices could be higher given the risk of disruption of supplies from Russia. But people are still lost figuring out those numbers.”
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