backwardation

American  

[bak-wer-dey-shuhn] / ˌbæk wərˈdeɪ ʃən /

noun

1. (on the London stock exchange) the fee paid by a seller of securities to the buyer for the privilege of deferring delivery of purchased securities.

---

backwardation British  

/ ˌbækwəˈdeɪʃən /

noun

1. the difference between the spot price for a commodity, including rent and interest, and the forward price

2. (formerly, on the Stock Exchange) postponement of delivery by a seller of securities until the next settlement period

---

Etymology

Origin of backwardation

First recorded in 1840–50; backward + -ation

Compare meaning

How does backwardation compare to similar and commonly confused words? Explore the most common comparisons:

• contango vs. backwardation

Example Sentences

See Examples For:

backwardation

“The curve structure also strengthened, with the front end returning to backwardation after recently flipping into contango amid the ramp-up of Persian Gulf supply.”

From The Wall Street Journal ● Jul. 8, 2026

At the same time, the current backwardation in the gas market—when front-month prices trade above winter contracts—is providing little economic incentive for traders and utilities to inject additional gas into storage ahead of winter.

From The Wall Street Journal ● Jun. 2, 2026

Slok pointed out that the Brent forward curve — the relationship between current prices of a futures contract and prices for contracts at later delivery dates — is in steep backwardation.

From MarketWatch ● Apr. 22, 2026

That leaves the “futures duration curve in a steep backwardation dynamic” — meaning the current price is higher than prices for contracts for delivery further out in the future, Richey told MarketWatch.

From MarketWatch ● Jan. 26, 2026

The X platform was full of people who couldn’t spell backwardation six months ago suddenly explaining why silver is overvalued.

From MarketWatch ● Dec. 30, 2025