OP: Huge jump in crude inventories sends oil prices tumbling
Oilprice.com reports: The American Petroleum Institute (API) has reported a major inventory build of 12.940 million ...
F: MAKING MONEY IN CHINAMAERSK: THE DAY AFTERDHL: NEW DEALGXO: NEW PARTNERSHIPKNIN: MATCHING PREVIOUS LOWSEXPD: VALUE AND LEGAL RISKMAERSK: DOWN SHE GOESVW: PAY CUTFDX: INSIDER BUYXOM: THE PAIN IS FELTUPS: CLOSING DEALSGXO: LOOKING FOR VALUE
F: MAKING MONEY IN CHINAMAERSK: THE DAY AFTERDHL: NEW DEALGXO: NEW PARTNERSHIPKNIN: MATCHING PREVIOUS LOWSEXPD: VALUE AND LEGAL RISKMAERSK: DOWN SHE GOESVW: PAY CUTFDX: INSIDER BUYXOM: THE PAIN IS FELTUPS: CLOSING DEALSGXO: LOOKING FOR VALUE
FORBES reports:
As the pandemic rages, so do oil prices, reaching levels not seen since January 2020, when the virus was still a gleam in the epidemiologists’ eyes. A variety of reasons have been given for this trend, including recovering demand and suppressed supply, the vaccine roll-out, and falling inventories. Indeed, the futures price has returned to backwardation, with the current contract nearly $1 higher than the 4th month contract, almost the same as early 2020.
Which is a bit perverse, given that the fundamentals do not—at this point—seem to justify such prices, let alone backwardation. Backwardation, when current prices are above future prices, implies that the market is tight, which is why current contracts have a premium. (Remember that futures prices are not predictions of the price in the future but what people are willing to pay today for barrels at a future date.)
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