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On May 16, 2022, please explain what you need to do in the spot market and futures market. Assume on May 16, 2022, the spot
On May 16, 2022, please explain what you need to do in the spot market and futures market. Assume on May 16, 2022, the spot price of crude oil is $88.23/barrel, and the futures price of your contract is $89.06/barrel. What is your total cost on May 16, 2022? What is the basis on May 16, 2022? If the basis decreases unexpectedly, will your position improve or worsen? Please explain.
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