Supply surplus expectations emerge, Brent crude’s near-month spread turns to contango for the first time since February

Odaily Odaily reports that as the US-Iran agreement reopened the Strait of Hormuz, increasing oil supply in the Middle East, the Brent crude near-month spread has turned to contango for the first time since February, meaning the near-month contract price is lower than the next-month contract.

This structure typically signals expectations of a supply surplus. It is the latest in a series of indicators suggesting the oil market is softening, as physical crude premiums decline. Earlier today, Brent crude prices fell below $75 per barrel for the first time since the outbreak of the Iran war. Before Brent crude turned to contango, the Middle East Dubai market also saw a similar trend in recent days. (Jinshi Data)