- Oil prices have reached the highest levels since the all-time highs in 2008. The most obvious explanation for the sharp rally is the military conflict in Ukraine and the threat of a loss of Russian oil supplies.
- The extent to which a forward curve is in backwardation or contango is strongly correlated to the level scarcity or abundance of inventories relative to demand.
- We will do a deep dive into the strong move at the back end of the oil curve in an upcoming report.
For further details see:
Long-Term Oil Prices Beginning To Reflect The Coming Oil Shortage - Part I