Investors are increasingly pricing in a bullish outcome for crude oil contracts, driven by the latest inflation metrics released by the Bureau of Labor Statistics. According to the Consumer Price Index (CPI-U) for all items, not seasonally adjusted (1982-84=100), the index has climbed to 337.511 in October. This figure represents a notable increase from the 336.94 recorded in September and the 334.98 seen in August, signaling that demand-pull inflationary pressures remain active in the economy.
This persistent rise in the cost of living is influencing market expectations for commodity values. High inflation typically drives up the price of commodities like crude oil as investors seek assets that can hedge against potential currency devaluation. Consequently, this macroeconomic backdrop is boosting the implied probability of the 'Above $75' settlement outcome for the KXWTI contract.
Source: BLS FRED series last updated 2026-11-10 08:12:50-06 (BLS)
What would change this read
A significant shift in the bullish outlook would occur if the October CPI-U print fell below 335.0, as such a deflationary reading would likely signal a drop in oil demand and undermine the current inflationary hedge narrative.
