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Commodities: Crude Oil

  1. Introduction to Commodities
  2. Commodities: Cocoa
  3. Commodities: Coffee
  4. Commodities: Copper
  5. Commodities: Corn
  6. Commodities: Cotton
  7. Commodities: Crude Oil
  8. Commodities: Feeder Cattle
  9. Commodities: Gold
  10. Commodities: Heating Oil
  11. Commodities: Live Cattle
  12. Commodities: Lumber
  13. Commodities: Natural Gas
  14. Commodities: Oats
  15. Commodities: Orange Juice
  16. Commodities: Platinum
  17. Commodities: Rough Rice
  18. Commodities: Silver
  19. Commodities: Soybeans and Soybean Oil
  20. Commodities: Sugar
  21. Commodities: Wheat
  22. Understanding Commodities Trading

Crude oil is one of the most important commodities in the world. It’s an unrefined petroleum product composed of hydrocarbon deposits and other organic materials that can be refined to produce usable products such as gasoline, diesel and various types of petrochemicals. This section discusses contracts for West Texas Intermediate (WTI) oil, a sweet crude oil that’s less sour than Brent oil, its European counterpart. Still, both are considered light and sweet, making them ideal for refining into gasoline.

Contract Specifications

Ticker Symbol

CL (CME Globex)

Contract Size

1,000 barrels

Contract Months

All months: F, G, H, J, K, M, N, Q, U, V, X, Z

Trading Hours

CME Globex: Sunday – Friday, 6:00 p.m. – 5:00 p.m. (there’s an hour break from 5:00 to 6:00 p.m. each day)

Last Trading Day

The third business day prior to the twenty-fifth calendar day of the month preceding the delivery month.

Price Quote

U.S. dollars and cents per barrel

Tick Size

$0.01 per barrel ($10 per contract)

Production        

WTI oil is produced, refined and consumed in North America. It’s sourced from U.S. oil fields – primarily in Texas, Louisiana and North Dakota – and refined mostly in the Midwest and Gulf Coast regions. The major trading hub for TWI is Cushing, Oklahoma, which is the delivery point for crude contracts.

Price Drivers

WTI oil is considered the benchmark for oil pricing in the U.S. As such, its price is very sensitive to factors that influence the price of crude oil in general. In addition to supply and demand, the price of WTI is also driven by:

  • geopolitical and economic events
  • stockpiles at Cushing, Oklahoma
  • OPEC’s production target
  • natural disasters

 


Commodities: Feeder Cattle
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