RE:less than two months to possible negative energy inflationThere is a lot of turbulance in the oil paper contract presently.
Lots of gambling on near term events - price caps, sanctions, china reawakening etc.
These wagers have been placed into 1 month contracts. When the contract ends, all punters need to be out (the punters don't have the ability to take delivery of actual oil)
When the end of a given contract approaches, price volitility tends to increase - particularly when a percieved event turns out to have been delayed to the other side of the expiry date.
Futures contracts have days or weeks of life. Companies have no expiry date (in theory they last for ever).
Daily contract price changes should have minimial impact on the present value of a producer's total future cash flows.
Instead, short term (daily contract prices changes), cause similar price changes in producer share price.
This is the tail wagging the dog. Its a virtual event. It happens when computer trading dominates the moment.
In the real world the dog wags the tail.
$80 oil can happen in the virtual world - its happenning now. But its an unstable event.
Reality is stable.