**Key Insights on Oil Market Signals and Volatility**
U.S. oil markets are currently experiencing significant volatility due to geopolitical tensions, particularly stemming from a conflict with Iran and the United Arab Emirates’ recent exit from OPEC. This instability has caused West Texas Intermediate crude prices to increase from $66 to over $100 per barrel, with Brent crude climbing from $71 to $119. These changes indicate a fracture in the longstanding oil supply dynamics, reminiscent of the oil crises in 1973.
Jonathan Rose, an experienced trader, emphasizes two critical market signals for investors to monitor: the crack spread and backwardation in futures. The crack spread, which measures refiners’ profit margins, is expanding, suggesting that refiners are benefiting from increased prices. Simultaneously, the futures market shows backwardation, indicating immediate supply pressures as buyers pay premium prices for near-term contracts. These signals point toward bullish opportunities in energy, particularly for refiners.
Rose will further explore these signals and their implications for investors on May 28, 2023, at 8 p.m. Eastern during a special event, which aims to reveal strategies for capitalizing on market volatility.
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