We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Mixed
GBP/USD
Mixed
USD/JPY
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Gold
Mixed
Oil - US Crude
Mixed
Bitcoin
Mixed
More View more
Real Time News
  • Gold Price Outlook: Gold Prices Bounce, Can Bulls Continue to Push? https://www.dailyfx.com/forex/fundamental/daily_briefing/session_briefing/daily_fundamentals/2019/10/14/gold-price-outlook-gold-prices-bounce-can-bulls-continue-to-push-js53-gold-price.html $Gold https://t.co/lkhwJiWyFg
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 96.64%, while traders in France 40 are at opposite extremes with 79.58%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/3fnicdJA3K
  • China-US trade talks made breakthrough last week with both sides showing a strong will to reach a final deal - Global Times
  • RT @HuXijin_GT: Based on what I know, China-US trade talks made breakthrough last week and the two sides have the strong will to reach a fi…
  • If a #Brexit deal is reached, Sterling will rally further, while in the equity space, the domestically-focused FTSE 250 should outperform the export-focused #FTSE 100. Get your market update from @nickcawley1 here: https://t.co/nfgon4la8s https://t.co/IEBfQ1wYx9
  • Indices Update: As of 13:00, these are your best and worst performers based on the London trading schedule: US 500: -0.13% Wall Street: -0.21% Germany 30: -0.32% France 40: -0.51% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/Kh9F9IPP6d
  • RT @carlquintanilla: Morgan Stanley thinks the next few weeks/months could “resemble what we saw last December, albeit less dramatic given…
  • RT @onlyyoontv: Chatted China’s take on DC trade talks and, @SullyCNBC— as I mentioned, Tencent has started broadcasting @NBA games again!…
  • BoE's Cunliffe says Brexit uncertainty has weighed on investment, adds that even if we get a Brexit transition deal, still do not know what the final trading relationship will be $GBP
  • .@DailyFX has just launched our new Worldwide Commodities Infographic. Be sure to check it out here to track major geopolitical players as well as live market prices -> https://www.dailyfx.com/research/global-commodities https://t.co/gUmzIfJReN
Crude Oil Price Outlook: Oil Backwardation Highest in 6 Years

Crude Oil Price Outlook: Oil Backwardation Highest in 6 Years

2019-09-17 09:20:00
Justin McQueen, Analyst
Share:

Oil Price Analysis and News

  • Oil Watchers Await Saudi Oil Minister Press Conference
  • Oil Backwardation Hints at Lengthy Supply Disruption

Crude Oil Watchers Await Saudi Oil Minister Press Conference

Geopolitical tensions in the Middle East remain at the forefront of investors’ minds with the Saudi Oil minister scheduled to speak from 18:15BST. It is expected that he will update on the severity of the damage sustained at the Abqaiq oil processing facility and the length of time it will take to return back towards full capacity. That said, a suggestion that it will take longer than a few weeks to restore the oil processing facility is likely to keep oil prices at these elevated levels.

Crude Oil Price Outlook: Oil Backwardation Highest in 6 Years

Oil prices sees over a 6 standard deviation move.

Crude Oil Backwardation Hints at Lengthy Supply Disruption

In the futures market, backwardation (spot price at a premium to futures price) in the Brent crude 6-month futures curve has spiked to its highest since September 2013, a time at which Brent crude futures were trading above $100/bbl. As such, markets signal that the supply shortage from Saudi Arabia may be somewhat longer than a few weeks, raising the likelihood that Brent crude futures could make another move above $70/bbl. That said, reports from Saudi Aramco this morning note that customers have been told that October oil loadings are likely to be delayed.

Crude Oil Price Outlook: Oil Backwardation Highest in 6 Years

Oil Impact on FX

Net Oil Importers: These countries tend to be worse off when the price of oil rises. This includes, KRW, ZAR, INR, TRY, EUR, CNY, IDR, JPY

Net Oil Exporters: These counties tend to benefit when the price of oil rises. This includes RUB, CAD, MXN, NOK.

Recommended Reading

What Traders Need to Know When Trading the Oil Market

Important Difference Between WTI and Brent

Crude oil facts

--- Written by Justin McQueen, Market Analyst

To contact Justin, email him at Justin.mcqueen@ig.com

Follow Justin on Twitter @JMcQueenFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.