On March 25, the US crude oil May 2019 futures closed just ~$0.08 above the May 2020 futures. On March 18, the futures spread was at a premium of $0.24. On March 18–25, US crude oil May futures fell 0.9%.
Fall in bullish sentiments
The market sentiment towards the oil demand and supply situation is reflected in the futures spread. In the last five trading sessions, the spread’s premium contracted. US crude oil prices fell 0.9%. Fear of an economic slowdown dragged the spread’s premium and oil prices. If the spread’s premium flips to a discount, it would signal more bearish sentiments for oil.
As of March 25, the US crude oil futures contracts for May and October were priced in ascending order. The price pattern is a negative sign for ETFs that follow US crude oil futures like the ProShares Ultra Bloomberg Crude Oil ETF (UCO) and the United States 12 Month Oil ETF (USL).