How Tight Are Physical Oil Markets? Time Spreads Offer Hints

Macroeconomic concerns pushed oil lower this week as the recent rise in interest rates spilled bearishly into the stock market and ultimately pushed risk assets lower across the board. In the U.S., the spike in the 10yr yield to 3.25% (7-year high) instigated a drop in S&Ps of 232 points from its all-time high on October 3rd through its weekly low on October 11th representing an 8% decline. While macro pressure could persist as a bearish factor for oil in the near term, we’re thinking the more powerful influence on oil prices in the short…

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