Where finance and media intersect with reality.

Parlez-vous oil trader?

Screenshot 2026-04-15 at 15.22.41

Driving back from an absolutely splendiferous end-of-season ski trip in France yesterday, we were, as ever, faced with the cognitively burdensome task of figuring out what to listen to on the 10-hour-plus journey. Nostalgie Radio is wonderful, but patchy in coverage. And who, seriously, can take another episode of the Joe Rogan podcast these days?

With Spring and finance on our minds, we figured, hell, why not: let’s tune into the latest from the IMF webcast. And thus we stumbled onto Gillian Tett moderating a MENA Economies panel focused on managing the shocks from the Iran war.

Ever anthropological, Tett took it upon herself to flag a new vogue popping up in media linguistics. “Words like backwardation and contango, which aren’t usually tossed around, are now incredibly important,” she mused, asking IMF chief energy economist Tim Gould to provide a “quick primer” in what it all means “so that next time we have a conversation with our bosses or at a dinner party we can sound really smart”.

This irked some of our travelling party. [IYKYK].

More importantly, however, it made me realise it’s been nearly a decade since I retired my old FT Alphaville shtick of relentlessly overwriting about contango and backwardation. In the meantime, clearly, a whole new cohort of readers has arrived, none the wiser about the legacy work already done to “raise awareness” about these terms.

So, if you’re interested in filling that knowledge gap, I recommend starting with the time I used scripture to explain how the commodity warehouse trade works.

Then there was the time Tracy Alloway (now of Bloomberg) and I engaged in a physical oil trade to prove why small-scale physical transcations just don’t make any sense.

For his part, Tim Gould offered the following explainer:

“Backwardation matters because it’s a signal to the market about essentially what you should do with your inventories, and you’re having very steep backwardation at the moment. What does that actually mean? Front-price is much higher than the prices for deferred delivery. And what that means is the market is screaming: ‘we are short barrels now; use your inventories; try and bring us barrels to the market as soon as you can!’ And that’s in fact what you’re seeing in markets. Inventories have come down quite sharply this month because of that shortfall in available deliveries from traditional producers in the Gulf.”

That may suffice for some. But if you’re interested in a sample of the greater “parlez -vous oil trader” back-catalogue please see below (it hails from the days FT Alphaville was rough and ready and largely unedited, so please be forgiving of typos):

The reminiscences of once being a commodity reporter, however, don’t stop there. This morning, we were delighted to receive a note from an old source of ours, Morgan Downey, a former commodities trader turned author of the ultimate entry-level guide to oil trading: Oil 101.

Downey has just updated his essential tome with a chapter covering the 2026 Iran and Strait of Hormuz crisis. We’d like to give the book a plug, as it really is a great primer. The new chapter is available here.

Downey is also running a countdown to when net oil-importer strategic reserves are totally exhausted. This is currently estimated to be June 13.

We also really liked this graphic:

In fact, it inspired our own (Claude-rendered) equivalent for the ROW:

Picture of Izabella Kaminska

Izabella Kaminska

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