- Oil topped $112/Bbl Tuesday morning, the highest since 2011
- The oil market’s structure has moved into “super-backwardation,” indicating extreme scarcity
- Russian oil and oil products are struggling to find buyers
- Russia’s flagship crude oil was for sale at a record discount (Bloomberg)
- Oil trading firm Trafigura Group tried to sell a cargo on Tuesday of Russian Urals at a discount of $18.60/Bbl to Brent
- The company received no buyers despite the reduced price
- Tanker owners are avoiding Russian crude on concerns that their vessels will be caught up in future sanctions
- The oil futures curve is at levels of strength not seen this century (Bloomberg)
- The May Brent futures contract was trading more than $4/Bbl above the next month – a near-unprecedented level
- WTI’s twelve-month times spread is currently at 39% backwardated. For reference, 10-13% backward is historically a high level
- Traders are willing to pay huge premiums to secure a more-immediate supply