mcmc

If you are an oil producer and you can sell oil at $90 per barrel in the spot market while the 30 day future price is $80 per barrel. You would prefer to produce and sell as much as you can now instead of locking yourself in at $80. If however the spot price is $80 and 30 day futures price is $90, you will stop all production or prefer to store and sell at the futures price that the spot.