The oil market’s main gauge is showing signs of oversupply in the United States in the latest sign of a looming global glut.
The so-called spot spread, which measures the difference in price between futures for immediate delivery and those for delivery a month later, traded in negative territory for the first time since February. This reflects a bearish market structure called contango, which is an indicator of ample supply in the near term.
Traders are closely monitoring supply and demand indicators as the new year approaches, with the International Energy Agency warning of a surplus of more than 1 million barrels per day.
The agency said inventories could swell further if the OPEC+ alliance returns some production to the market next year, but for now the US crude futures curve is still holding slightly higher.
