Awesome post. So what does your book look like? Are you hedging like a corporation, or are you comfortable with a fistful of Dec 15 Nymex crude? I can't imagine that you have no position, with all that you know.

The chart that provided the spot price along with the futures curves at selected points provides me some real insights. I'm not quite sure where to get the data, but I'd love to create a price chart that had both the spot price and the longest-dated contract price at the same point in time, and see how they moved relative to each other. I'd expect the spot price to move more dramatically due to transient conditions (hurricanes, etc).

I wonder if the path over time of the long-dated contract price might end up providing an interesting proxy for "real" oil prices with the transient problems factored out. For instance, over the past few months I've noticed spot prices fluctuate by as much as $15, while the long term contract moved by perhaps $4.