Asset classes internalize crude-futures disconnect, Guy LeBas notes

Asset classes internalize crude-futures disconnect, Guy LeBas notes
Crude futures differ from physical price

Guy LeBas observes a divergence between futures pricing for crude oil and the value of physically delivered barrels. He notes that, despite tough news at the start of the overnight session, screen-traded crude may not be a reliable market indicator at present.

LeBas points out that most asset classes have recognized this disconnect, treating futures prices and physical delivery as vastly different.

LeBas has recently commented on other market measures. He noted that IG cash spreads widened to 89 basis points, placing them in the lowest historical quintile. In economic data, he also reported that his core PCE model projection of 0.37 percent closely matched the actual increase recorded by official data.

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