OXY, Brent, Aramco indexed to 100 (last 14 days)
OXY fell 12.72% in seven days. Aramco moved 0.29% in fourteen. The war premium came out of one and not the other.
Brent front month fell 14.18% in seven days, closing $101.29 Friday after touching $118 two weeks ago.
OXY closed $53.03, down 12.72% in seven days. COP −11.21%. XOP −7.07%. XOM −6.53%. EOG −6.53%.
Aramco, the largest oil producer in the world by output, closed 27.20 SAR Wednesday on Tadawul. Down 0.95% in seven days. Up 0.29% in fourteen.
The two US E&P operators most exposed to crude price flatly cratered. The state name with the lowest production cost on earth held within tick-size.
OXY at $53 trades roughly 6x EBITDA against a Brent strip. A 10% move in the strip flows to roughly 15% on the equity. Operating leverage runs both ways, and this week it ran down.
Aramco runs differently. State-controlled, dividend-anchored at $124B annualized, output dictated by a kingdom not a margin curve. Empirical correlation of Aramco daily returns to WTI sits near zero.
The proximity-zero name does not move because the war premium was never in it. The premium was always in the front Brent contract and in the leveraged operators that mark to it.
Front Brent down 6.41% over fourteen days. July contract down 0.39%. August +0.84%. September +1.34%. December +1.30%. March 2027 +1.01%.
The front-to-March-2027 spread compressed from $26.25 to $18.48 in fourteen days. $7.77 of backwardation came out of the curve.
March 2027 sat at $82.81. The terminal value barely moved. The market is pricing pre-war normalization for 2027 and is steadily un-pricing the front bid.
VIX9D 14.21. VIX 17.19. VIX3M 20.50. VIX6M 22.59.
The 9-day measure prints below the spot index. Front-of-curve vol is at panic lows while six-month structural risk holds at 22.59.
Same shape as Brent. Same shape as the Hormuz prediction-market term structure (May 15 returns-to-normal at 1.6%, June 30 at 50.5%). Three independent term structures saying the same thing.
Silver +12.33% in seven days, closing $80.39 Friday. Gold +3.85%. Copper +6.30%. The metals complex broke out while front oil broke down.
HY OAS at 279bp, 30-day low. IG OAS at 79bp. AAA OAS quietly widening +3bp from 35 to 38, the only credit spread moving the wrong way.
USDJPY closed 156.83, yen up 1.71% in seven days. DXY 97.84, dollar weakening. The carry-and-curve combination tracks falling real yields, which is exactly the regime where commodities run and where the front of the oil curve gives up its premium.