Crude Time Spreads Stable After WTI Prompt Falls into Contango Again

The prompt WTI time spread is back in contango with weak demand offsetting near term supply disruptions from Iraq and OPEC+ supply risks. Strong Russia supplies continue to weigh on global oil prices.

• The remainder of the crude curves are still in narrow backwardation with the Dec23-Dec24 spread near the lower end of the range so far this year. The spread is up from a low of around 2.0$/bbl at the start of May but is well below the April high of 5.9$/bbl.
• The forward curve backwardation is holding with many expecting of a supply deficit in the second half of this year driven by lower OPEC supplies, a demand recovery in China and low US petroleum inventory levels.
• US economic and recession concerns due to persistent inflation are weighing on WTI with the discount to Brent increasing this week. The WTI-Brent spread is out to the widest since early April at -4.3$/bbl compared to around -3.85$/bbl earlier this week.
  • Brent JUL 23 up 0.1% at 76.33$/bbl
  • WTI JUL 23 up 0.3% at 72.03$/bbl
  • WTI-Brent up 0.01$/bbl at -4.3$/bbl
  • Brent JUL 23-AUG 23 down -0.01$/bbl at 0.07$/bbl
  • Brent DEC 23-DEC 24 down -0.01$/bbl at 3.25$/bbl
  • WTI JUL 23-AUG 23 up 0.01$/bbl at -0.09$/bbl
  • WTI DEC 23-DEC 24 up 0.02$/bbl at 3.68$/bbl