Crude Oil Conatango Increases

Contango in crude oil futures increased in the last few days, making the roll trade attractive again. This is a clear sign that there is excess supply over demand and that the demand and price expectations are high. Profitable roll trade will bring additional money to the markets making oil price harder to decline.

Chart 1. WTI Futures Curve

Source: Bloomberg

This entry was posted on Tuesday, April 13th, 2010 at 1:59 am and is filed under Commodities. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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