You are a short hedger $($i$.$e$.$ you sell commodities using futures contracts$),$ therefore your realized price will be greater than your target price when the realized basis is narrower $($less negative$)$ than your expected basis because: $($mark all that are correct$)$

If both spot and futures prices go up$,$ the spot price rises more slowly than the futures price and hence the gain in your local market outweighs the loss in the futures market.

If both spot and futures prices go down, the spot price drops more slowly than the futures price and hence the loss in your local market is more than compensated by the gain in the futures market.

If both spot and futures prices go down, the futures price drops faster than the spot price and hence the loss in your local market is more than compensated by the gain in the futures market.

If both spot and futures prices go up$,$ the futures price rises more slowly than the spot price and hence the loss in the futures market is more than compensated by the gain in your local market.