Why Oil Futures Are Trading Way Below Real-World Prices

Six weeks into the Iran war, crude oil markets are experiencing one of their worst-ever disruptions, triggered by the near-closure of the Strait of Hormuz. Hundreds of ships are bottled up in the Persian Gulf, unable to carry their cargoes out of the region.

Worries that shippers won’t be able to get supplies out of the Persian Gulf have caused global oil prices to skyrocket. Contracts guaranteeing immediate delivery of oil have posted the sharpest gains, widening the gap between near- and long-dated prices to a record.