Lasting contango in oil: market spread to outlast supply-demand imbalance

REUTERS | While vast cuts by producer countries and renewed fuel consumption from easing coronavirus lockdowns may soon rebalance oil supply and demand, some analysts and traders see a glut in storage keeping the market in contango for much longer.


A contango market structure LCOc1-LCOc7 means the current value is lower than it will be in later months and encourages traders to store oil to resell it in the future.


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