Contango

[Tom Kirkman + 8,860]

MbS is gonna be sooooo pissed!

(Angel butterfly wing dreams of massive wealth for Aramco IPO jackpot suddenly come crashing to Earthly reality.)

Anyway, here's the news:

Oil Market Flashes Warning - Prompt Brent Flips Into Contango

For the first time since September, the front-month Brent futures curve has flipped into contango suggesting notable physical supply being added (driving the front-month below the curve) - a sure sign of an oversupplied market.

Despite oil’s surge to near $80 a barrel, some corners of the market that reflect the trading of actual barrels are weakening fast.

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Looks like oil bulls are getting a surprise showing at the rodeo.

[Tomasz + 1,608]

We are in peak of rafinery maintenance - trade bulls  need to wait to middle of June for global oil deficit. Second quater is always quite bad time for phisical market.

Especially with venezuelan sanctions and iranian sanctions I dont see a big drop in oil prices.

For me more important - according to IEA 26 milions of barrels drop in OECD countries oil inventories in march - counterseasonally.

In december or january I dont remember more than 50 millions drop. 50 milions per 31 days  - I was really shocked in this result in situation of soaring US production.

I'm still interested what was the real world oil demand in december 2017 and in whole 4 quarter after some corrections of IEA numbers. It must have been huge.

Edited May 18, 2018 by Tomasz