When nearby futures prices are cheaper than longer dated contracts, the market is in contango. The drilling activity is modest as it indicates an oversupply situation. If the contango is steep enough, it might be worthwile to store oil in tankers and sell it later at a better price.
If market turns into backwardation, nearby futures prices are more expensive than further out. In this environment, storage leads to a loss and if the price level is reasonable, drilling and production activity is high.
If WTI trades at a premium to Brent, companies with production in the US are getting better paid than the European/International counterparties.
When WTI on the other hand becomes cheaper than Brent, the opposite is true. In this scenario some US refineries have the option to switch from international to domestic supply and thereby increase their margin.
A consequence of oil and natural gas companies producing practically the same product, is that a portfolio of such equities can be analyzed from the combined fundamentals.
The ProxyPetroleum fund can as such be seen as a virtual oil and natural gas company that can quickly add or dispose assets to benefit from the market situation; to move our full production from Australia to North America is just a click away, speed that a real company could only dream of.