is the raw material that is
heating oil, jet fuel, propane,
and other products. In today's
complex global markets, the
price of crude oil is set by
movements on the three major
exchanges the New York
Mercantile Exchange, the
International Petroleum Exchange
in London and the Singapore
International Monetary Exchange.
Prices of crude oil have always
been politically volatile and
are greatly influenced by supply
and demand. They behave much as
any other commodity with wide
price swings in times of
shortage or oversupply and in
times of political instability.
The crude oil price cycle may
extend over several years.
There are two types of crude oil,
sour crude is primarily the type
of crude that comes from OPEC,
as opposed to West Texas
Intermediate (WTI) or sweet
crude. The WTI price is traded
on the New York Mercantile
Crude oil began futures trading
on the NYMEX in 1983 and is the
most heavily traded commodity.
It trades in units of 1,000 U.S.
barrels i.e. 42,000 US gallons
(1 contract), and the price is
quoted in dollars and cents per
barrel. The minimum price
fluctuation in the price of
crude oil is $0.001per barrel
($10 per contract).
Crude oil Futures trading has
always been of tremendous
interest to speculators who hope
to profit from the ever changing
price of this commodity