The more actively traded June contract is down by nearly 9%
There's no love for oil in this market still.
The contango is now slowly approaching $10, which is unprecedented, ahead of the expiry/rollover of the front month (May) contract tomorrow.
The front month contract is now down by nearly 29%, closing in on $13 while the more actively traded June contract is down by nearly 9% just under $23.
I would keep the focus on the latter given the current situation, but I reckon what we are seeing here is going to set a precedent for how oil may trade ahead of the expiry/rollover in the coming months as long as the current situation/outlook persists.
There's good argument for oil to gain on a valuation basis but that requires a long-term view beyond the depths of the coronavirus saga. For now, we are still in the eye of the storm.
Amid the "higher" price rollovers, it shows that the far month contracts will still follow how the front month trades (but possibly not as big a drop) - for now at least - so there's that to consider when seeing which way the June contract will be moving.