WTI December 2025 December 2026 Spread

Overview

The WTI December 2025 December 2026 spread has been trading in a sideways pattern for the past 3 weeks, in sync with the flat price having been overall in a sideways pattern during that time.

Much has been made in recent days of the notion that the decision by OPEC+ to raise output in July was a further attempt to "wrestle back market share". Its increased supply is weighing on crude prices, squeezing all producers, but some more than others, including a key group of rivals - U.S. shale producers, analysts say.  (Reuters)  One Reuters analyst wrote last week :" Oil drillers in the U.S. shale heartland are slowing down operations, a sign that OPEC's high-stakes price war is starting to pay off." Shale producers such as Diamondback Energy have warned that U.S. production will fall if prices do not rise.
U.S. energy firms this week cut the number of oil and natural gas rigs operating for a fifth week in a row to the lowest since November 2021, energy services firm Baker Hughes, said in its closely followed report on Friday. (Reuters)

Technicals

The above narrative suggesting production should fall should support the nearer by December 2025 contract versus the December 2026 contracts. Technically, momentum looks poised to turn upward to corroborate the idea that supply nearer term in the U.S. will shrink. There is a double bottom from Friday/today in the spread at -$1.29/-$1.27. Further support lies just below that at -$1.37 / -$1.39 from a few weeks ago. The low of -$2.25 was made back on May 5th, when the spot futures saw a bottom.
Upside resistance for the December 2025 versus the December 2026 lies at -38 cents, although a test of +30 cents is not unreasonable.

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