Storage models predict that the forward curve will be upward-sloping when the currency inventory levels are beyond the threshold levels of demand and that it will be downward sloping when inventories are tight. ===> straight out from textbook p.125 I have hard time to understand this logic. Here is my thought: when current inventory level is more than demand, the theory predicts the forward curve is upward sloping, which means the future spot price will be higher. Now if future spot price is predicted to be higher, it means demand will likely be higher than supply in the future so that commodity user will buy more to meet demand & have no incentive to store the commodity. The storage cost in the future will not be higher than now as the commodity will be used up by the stronger demand. SO does this mean whenever the storage cost is not significant in the future the storage model predicts the forward to be upward-sloping? (& vice versa) Please share your opinion and correct me if I am in the wrong track. Thanks!