All of the PowerShares DB Crude Oil ETNs are based on a total return version of the Deutsche Bank Liquid Commodity Index-Oil (the "Index") which is designed to reflect the performance of certain crude oil futures contracts plus the returns from investing in 3 month United States Treasury bills. The Long ETN is based on the Optimum Yield™ version of the Index and the Short and Double Short ETNs are based on the standard version of the Index. The Optimum Yield™ version of the index attempts to minimize the negative effects of contango and maximize the positive effects of backwardation by applying flexible roll rules to pick a new futures contract when a contract expires. The standard version of the index, which does not attempt to minimize the negative effects of contango and maximize the positive effects of backwardation, uses static roll rules that dictate that an expiring futures contract must be replaced with a contract having a pre-defined expiration date.
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Iran and the P5+1 world powers are close to an agreement in which the Persian nation would halt the most advanced elements of its nuclear program, including the production of weapons-grade fuel, in return for a limited easing of the sanctions that have badly hurt its economy.
The deal, which could be announced today, won't at this stage include a lowering of banking and oil sanctions, although the international negotiators could allow Iran to access $50B in crude export revenue that has been frozen in European and Asian banks.
Israel is opposed to the agreement, as are some U.S. legislators, with a Senate committee continuing to prepare a set of tough new sanctions despite the progress of talks.
WTI is flat at $94.24 a barrel, while Brent is also little changed at $103.46.