Oil to Enter Backwardation ‘Rapidly,’ Barclays Says
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Oil markets are poised to enter backwardation, with prompt-delivery prices higher than those for later supply, as demand for crude increases around the world, according to Barclays Plc.
“Global spare crude capacity has fallen this year and is likely to end the year at only a little above 5 percent,” a team led by Paul Horsnell, head of commodities research at Barclays Capital in London, wrote in a report yesterday. ``We expect a more volatile and backwardated market to emerge rapidly.”