WTI Up as Time Spread Hovers in Contango

WTI front month futures have ticked up moderately during US trading hours, although remain below the intraday high of $77.05/b. WTI has also shown a small downturn in US hours after rebounding to $76.61/b.

• Crude has regained ground after steep losses yesterday amid an improved risk sentiment and slight pull back from the downside pressure the bearish demand outlook is having on prices.
• The WTI prompt month time-spread has flattened and is oscillating between a shallow contango and shallow backwardation. Weak prompt demand, record US output and expectations of building Cushing stocks are weighing on the prompt and pushing the market towards contango.
• WTI DEC 23 up 1.1% at 76.15$/bbl
• WTI-Brent down -0.07$/bbl at -4.26$/bbl
• WTI DEC 23-JAN 24 down -0.02$/bbl at 0$/bbl
• WTI JAN 24-FEB 24 unchanged at 0.19$/bbl
• WTI DEC 23-DEC 24 up 0.03$/bbl at 3.12$/bbl
• Russia crude exports have also increased recently despite the ongoing pledge to cut output by 300kbpd until the end of the year.
• WTI options volumes were yesterday high at 248k compared to the year-to-date average of 123k although down from the peak seen the previous driven by a large call spread trade.