WTI Oil Futures in Backwardation Amid Supply Disruptions
WTI crude oil futures have entered a steep backwardation, with December 2026 contracts priced up to $40 below May and June contracts, reflecting expectations of short-lived supply disruptions from the closure of the Strait of Hormuz. The situation suggests traders anticipate a return to normal supply levels by year-end, with spot prices potentially falling to the mid-$70s. The backwardation indicates market expectations of tighter supply in the near term and potential price volatility.
Topics: Backwardation Oil Price Volatility Strait of Hormuz Supply Crunch WTI Oil Futures