Storage Oil Backwardation and Implications for MLPs

While oil storage assets play an important role in the energy value chain, they are not often in the spotlight. That is until the oil curve shifts into backwardation. With the oil curve backwardated, storage assets tend to garner more attention given the risk of lower utilization and re-contracting risk. In this piece, we discuss storage, oil curve backwardation, and the implications for MLPs with oil storage capacity.