A $34 gap between two prices for the same barrel is unheard of. Dated Brent - the one we actually deliver in 10 to 30 days' time - stands at $132.74 while the nearby contract is worth just $99.36. See the rift? That's where tensions are running high.
🔍 What's going on?
For the past few days, the two oil worlds have been abruptly disconnecting. On the one hand, those who want physical - real barrels to be received - are paying a hell of a price. On the other, financial contracts quoted on the stock exchanges remain much lower. This discrepancy reflects one simple thing: the immediate demand for exploitable oil far exceeds what the financial markets are willing to quote.
Gary Ross, boss of Black Gold Investors, doesn't mince his words: the market has never experienced such disruption. Uncertainty about what's coming next is compounding the malaise. The usual traders no longer recognize anything.
💡 Why does it matter?
This discrepancy shows you a reality that posted prices don't reflect. If you buy oil for actual delivery, you pay $133. If you trade futures, you're playing at $99. It's the same product, but two different worlds. Financial prices - the ones we see everywhere - hide an enormous physical tension.
The same phenomenon is apparent in gold and precious metals. The more the crisis escalates, the more people want the physical, the wider the gap becomes. This is a wake-up call that the derivatives markets can't ignore for long.
The same phenomenon is apparent in gold and precious metals.
📊 Our opinion
We're bearish on confidence in posted market prices. When the physical becomes twice as expensive as the official quotation, something is breaking in the system. This gap of $34 is not a passing anomaly - it's a signal that real demand is outstripping the market's ability to absorb it at posted prices. The next few weeks will tell whether futures are catching up with the physical or whether the divide is widening further.
✅ To remember
- Physical Brent at $133, futures Brent at $99: record gap.
- Demand for deliverable oil exceeds supply covered by financial contracts.
- Same phenomenon on gold and precious metals during crises of uncertainty.
What do you think?Do you trust the prices posted when the physical takes off? Or do you yell caution before things go off the rails?
🔎 Also to be read
To go further, find all our Commodities analyses on ActuTrading Commodities 📈
