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Backwardation: A Guide for Oil & Gas Investors

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Here's What You Need to Know

  • /Backwardation is a key concept in oil and gas operations and investing.
  • /Understanding backwardation helps investors evaluate oil and gas opportunities more effectively.
  • /BassEXP provides transparency on all technical aspects including backwardation in every investor package.

Oil & Gas Glossary · Backwardation

Backwardation: Detailed Explanation

Near‑term prices above deferred prices.

Signals tight prompt supply and inventory draws.

Benefits producers’ spot sales; roll yield helps long futures holders.

How Backwardation Works in Practice

Backwardation is a concept that investors encounter when evaluating direct oil and gas investment opportunities. Understanding how backwardation works in the context of well operations helps investors make more informed decisions about working interest positions and expected returns.

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