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About NYMEX Crude Oil Futures.

The New York Mercantile Exchange's light, sweet crude oil futures contract is the world's most actively traded futures contract on a physical commodity. Because of its excellent liquidity and price transparency, the contract is used as a principal international pricing benchmark. The NYMEX also offers trading in heating oil futures and gasoline futures.

Crude oil futures and options provide individual investors with an easy and convenient way to participate in the world's most important commodity market. In addition, a broad cross-section of companies in the energy industry - from those involved in exploration and production to refiners - can use crude oil futures and options contracts to hedge their price risk. Light, sweet crude is preferred by refiners because of its low sulfur content and relatively high yields of gasoline, diesel fuel, heating oil, and jet fuel. Even companies that are substantial consumers of energy products can use crude oil futures to protect against adverse price fluctuations.

You can trade more than just NYMEX crude oil futures online with optionsXpress! We also offer E-mini crude oil futures, which are just 50% of the size of a standard futures contract. E-mini crude futures trade exclusively on the Chicago Mercantile Exchange's Globex platform nearly 24 hours per day.

NYMEX Crude Oil Futures Specifications.

Crude oil futures, New York Mercantile Exchange, trading symbol CL, Minimum Tick Size: $0.01 per barrel, worth $10.00 per contract.

Electronic trading is conducted from 6:00 PM US until 5:15 PM US EST via the CME Globex® trading platform, Sunday through Friday.

Primary crude oil futures contracts trade every calendar month, from January through December.

Please see the disclosures page for additional information regarding this section.

Brokerage Products: Not FDIC Insured · No Bank Guarantee · May Lose Value.

© 2017 Charles Schwab & Co., Inc, All rights reserved. Member SIPC.

The Basics of Trading Crude Oil Futures.

Crude oil is one of the better commodities to trade. It is a very active market and it is well known to investors around the world. There is usually no shortage of news to cause the price of oil to move from day to day. This presents many good trading opportunities, whether you focus on day trading futures or you are a longer-term trader or investor.

Crude oil is one of the most actively traded commodities in the world.

The price of crude oil affects the price of many other assets including stocks, bonds, currencies, and even other commodities. This is because crude oil remains a major source of energy for the world.

Crude Oil Contract Specs:

Ticker Symbol: CL Exchange: NYMEX Trading Hours: 9:00 AM - 2:30 PM EST. Contract Size: 1,000 U. S. barrels (42,000 gallons). Contract Months: all months(Jan. - Dec.) Price Quote: price per barrel. Ex $65.50 per barrel Tick Size: $0.01 (1¢) per barrel ($10.00 per contract). Last Trading Day: Third business day prior to the 25th calendar day of the month preceding the delivery month. C.

Cude Oil Fundamentals.

Light Sweet Crude Oil is traded on the New York Mercantile Exchange (NYMEX). "Light Sweet" is the most popular grade of crude oil that is traded. Another grade of oil is Brent Crude, which is primarily traded in London. Crude oil is the raw material that is refined to produce gasoline, heating oil, diesel, jet fuel and many other petrochemicals. Russia, Saudi Arabia, and the United States are the world’s three largest oil producers. When crude oil is refined or processed, it takes about 3 barrels of oil to produce 2 barrels of unleaded gas and 1 barrel of heating oil.

Crude Oil Reports.

The main reports for crude oil are the EIA Weekly Energy Stocks report.

This report is released every Wednesday around 10:30 PM EST.

Tips on Trading Crude Oil Futures.

The prices of unleaded gas and heating oil can influence the price of crude oil. Demand is generally highest during the summer and winter months. A very hot summer or very active driving season (for summer vacations) can increase the demand for crude oil and cause prices to move higher. An extremely cold winter causes higher demand for heating oil, which is made from crude oil. This usually causes prices to move higher. Watch the weather in the Northeast, since it is the part of the country that predominately uses heating oil. Watch for oil production cuts or increases from OPEC.

Volatile Market for Crude Oil Futures.

Crude oil can be a volatile market. Major news events can happen overnight and cause the price of oil to have wide swings. The same thing can happen throughout the day, whether it is due to an economic report or tensions in the Middle East. A tight supply situation can exacerbate price movement.

Supply and demand obviously dictate how the price will move, but this market often moves on emotion. Much of that comes from the unknown. If tensions escalate in the Middle East, there is no telling the extent of possible supply disruptions.

Traders will often react swiftly on the news and then sort it out later.

Price Movements for Crude Oil.

The reason why prices move so swiftly is that traders who have short positions in the market tend to cover quickly. In order to do this, they have to place buy orders to cover. This wave of buying is done at the same time speculators are jumping on board to establish or add to long positions. The shorts will cover quickly because the risk is just too great if it is really a major development that could disrupt supplies.

The usual tendency is for oil prices to have a sharp spike higher on turmoil in the Middle East. Then prices calm down and start to move lower unless we start to see clear evidence of major supply disruptions. Identifying these waves of buying and selling are very important if you want to avoid getting whipsawed in the markets on emotions.

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For the most part, crude oil tends to be a trending market. There is usually a major bias to the upside or downside. Trading from the trending side will certainly help improve your odds of success. Crude oil also tends to get stuck in prolonged ranges after a sizable move. If you can identify these ranges, there are plenty of opportunities to buy at the low end and sell at the high end. I like to trade the ranges until there is a clear breakout either way.

The value of the U. S. dollar is a major component in the price of oil. A higher dollar will put pressure on oil prices. A lower dollar helps support higher oil prices. Crude oil also tends to move closely with the stock market. A growing economy and stock market tend to support higher oil prices. However, if oil prices move too high, it can stifle the economy. At this point, oil prices tend to move opposite the stock market. This usually becomes a concern when oil moves above $100.

Day Trading Crude Oil Futures.

Crude oil is one of the favorite markets of futures day traders. The market typically reacts very well to pivot points and support and resistance levels. I like to play the bounces off these levels when I see more than one of these numbers at the same level. You have to make sure you use stops in this market, as it can make very swift runs at any given time. Long time energy trader, Mark Fisher, wrote an excellent book on day trading oil futures – The Logical Trader.

There is no shortage of trading opportunities in crude oil from day to day.

The market is very active and it has plenty of volume. Beware of possible overnight moves that can take you by surprise. Much of the same principles that apply to stock index futures also apply to crude oil futures. If you like trading the E-mini S&P, you will probably like crude oil too.

Crude Oil Futures Trends.

Crude oil entered a bear market in June 2014 when the price was just under $108 per barrel on the active month NYMEX crude oil futures contract. By February 2016, the price depreciated to under $30 per barrel.

Impact of Crude Oil Futures.

Even if they do not trade or invest directly in crude oil, investors and traders all over the world follow the price of the energy commodity. When it comes to stock markets, there are so many companies involved in the exploration, production, processing, and servicing of the oil industry that moves in the price of crude oil effect major equity market indices around the world.

Crude oil affects debt markets for a number of reasons. Oil companies require vast sums of capital for production and other oil-related projects around the world. The amount of money lent by banks to the oil industry is significant. During slumps in the price of oil, defaults on oil-related loans have an important impact on the overall debt markets.

Additionally, many nations around the world depend on crude oil revenues; therefore, changes in the price of oil can directly affect government debt and currency levels in producing countries. When it comes to other commodities, energy is an important cost of goods sold a component of production.

Therefore, the price of crude oil directly affects the production cost of other raw materials.

While consumers do not buy raw crude oil, petroleum products like gasoline, heating oil, diesel and jet fuel and others are basic necessities for individuals around the world on a daily basis. The price of crude oil has a direct impact on most people that inhabit the earth.

Crude oil futures, or derivatives, reflect the prices of the physical petroleum markets around the world. Understanding the physical flows of oil from producers to consumers is an imperative when it comes to being a knowledgeable trader or investor.

NYMEX Crude Oil Futures and Options Market Trading.

*The information contained within this webpage comes from sources believed to be reliable. No guarantees are being made to the content's accuracy or completeness.

Light Sweet Crude Oil Futures Market Trading.

Crude oil futures are the world's most actively traded commodity, and the NYMEX Division light, sweet crude oil futures contract is the world's most liquid forum for crude oil future trading, as well as the world's largest-volume futures contract trading on a physical commodity. Additional risk management and trading opportunities are offered through options on the crude oil future contract; crack spread options on the pricing differential of heating oil future contracts vs. crude oil future contracts or unleaded gasoline futures contracts vs. crude oil futures. The NYMEX crude oil future contract may be the most important energy future contract in the world.

Crude Oil Futures and Options Quick Facts.

1,000 barrel contract.

one cent move equals $10.

trades every month.

Crude oil futures symbol (CL)

Here is the brochure from the CME Group/NYMEX for WTI Crude oil futures and options.

Geopolitical concerns in the Middle East can cause extreme volatility in the crude oil futures and options markets as well as the distillates such as unleaded gasoline and heating oil. Tensions with Iran are especially important to energy traders because Iran's daily crude oil production is estimated to be around 4 million barrels. They also have the potential to hinder or block the Straits of Hormuz with their navy which can cause major shipping delays. Approximately 20% of the world's oil passes through the straits making geopolitical tensions with Iran a critical factor in crude oil futures prices.

The crude oil futures contract trades in units of 1,000 barrels, and the delivery point is Cushing, Oklahoma, which is also accessible to the international spot markets via pipelines. The crude oil future contract provides for delivery of several grades of domestic and internationally traded foreign crude oils, and serves the diverse needs of the physical crude oil market.

During the September 11 terrorist attacks the NYMEX was destroyed but within days the crude oil futures and crude oil options markets were trading again. This is a testament to the strength and viability of the energy future markets and the commodity exchanges in the United States of America.

The Crude Oil Futures Contracts-Crude Oil Pricing.

New York Mercantile Exchange Middle East crude oil future contract trades with prices quoted in dollars and cents per barrel ($00.00/bbl) and a contract unit of 1,000 barrels. The max/min price fluctuation rules are consistent with the Exchange's light, sweet crude oil future contract as are settlement procedures.

After the last day of regular trading, final settlement of the crude oil futures contract is based on cash settlement against the cumulative monthly average of the index over the course of the contract month. The calculation of the final crude oil futures settlement price is completed on the final business date of the contract month (e. g. October 30 for the October 1998 contract).

Are you a crude oil hedger? If so, click here to learn more.

Crude Oil Options on Futures Contracts Explained.

A crude oil call option gives the purchaser the right but not the obligation to purchase the underlying futures contract for a specific time period and a specific price (strike price). Let's say that you wanted to purchase a February crude oil $50 call option and pay a premium of $1,900.

This means that you bought the right but not the obligation to buy 1,000 barrels of February crude oil for $50 per barrel. Of course, very few options are bought for the purpose of taking delivery but that is one potential outcome. Chances are that you either bought the crude oil option to hedge your price risk in the physical crude oil market (maybe you are a producer and own an oil well or you are a consumer and own a refinery) or you are speculating that crude oil prices will go higher in an attempt to make a profit.

A crude oil put option gives the purchaser the right but not the obligation to sell the underlying futures contract for a specific time period and a specific price. Let's say that you wanted to buy a February crude oil $40 put option and pay a premium of $1,150.

This means that you have the right but not the obligation to sell 1,000 barrels of February crude oil at $40 per barrel.

The delta factor of an option represents the estimated percentage of change an option will receive based on the movements in the underlying futures contract.

Let's assume the February crude oil $50 call option above has a 30% delta factor. This means that if the underlying futures contract were to rally by $1,000, then the call option would accrue by approximately $300 or 30% of $1,000 in the crude oil futures contract.

Options are wasting assets which means that they lose value as time passes. The theta of an option is the measure of time decay.

Let's assume that you bought a February crude oil $50 call option with 60 days left until expiration. Let's also assume that the crude oil futures prices have moved very little over the last month and are exactly the same price 30 days later. Your option will have lost 30 days worth of time and therefore will be worth less today that it was when it had 60 days left until expiration.

Vega is a measure of the implied volatility of an option contract as it relates to its underlying futures contract. For instance, if the underlying futures contract is extremely volatile then the implied volatility of the options of that futures contract will be affected.

In a high implied volatility environment option premiums tend to expand. Conversely, in a low implied volatility environment the option premiums tend to decrease.

*Contract information changes from time to time. Please click here to see the most recent contract specifications and click here for the most recent trading hours.

Contract Specifications.

Light, Sweet Crude Oil Future Contract.

Futures: 1,000 U. S. barrels (42,000 gallons).

Options: One NYMEX Division light, sweet crude oil futures contract.

Crude Oil Futures and Options: Dollars and cents per barrel.

Crude Oil Futures and Options: Open outcry trading is conducted from 9:00 A. M. until 2:30 P. M.

After hours crude oil futures trading are conducted via the GLOBEX internet-based trading platform beginning at 3:15 P. M. on Mondays through Thursdays and concluding at 9:30 A. M. the following day. On Sundays, the session begins at 6:00 P. M. All times are New York time.

Crude Oil Futures: 30 consecutive months plus long-dated crude oil futures initially listed 36, 48, 60, 72, and 84 months prior to delivery.

Additionally, crude oil futures trading can be executed at an average differential to the previous day's settlement prices for periods of two to 30 consecutive months in a single transaction. These calendar strips are executed during open outcry trading hours.

Crude oil options: 12 consecutive months, plus three long-dated options at 18, 24, and 36 months out on a June/December cycle.

Minimum Price Fluctuation.

Crude oil Futures and Options: $0.01 (1ў) per barrel ($10.00 per contract).

Maximum Daily Price Fluctuation.

Crude Oil Futures: $10.00 per barrel ($10,000 per contract) for all months. If any contract is traded, bid, or offered at the limit for five minutes, crude oil futures trading is halted for five minutes. When trading resumes, the limit is expanded by $10.00 per barrel in either direction. If another halt were triggered, the market would continue to be expanded by $10.00 per barrel in either direction after each successive five-minute trading halt. There will be no maximum price fluctuation limits during any one trading session.

Crude oil o ptions: No price limits.

Last Trading Day.

Crude Oil Futures: Trading terminates at the close of business on the third business day prior to the 25th calendar day of the month proceeding the delivery month. If the 25th calendar day of the month is a non-business day, crude oil futures trading shall cease on the third business day prior to the last business day proceeding the 25th calendar day.

Crude oil o ptions: Trading ends three business days before the underlying futures contract.

Options Strike Prices.

Twenty strike prices in increments of $0.50 (50ў) per barrel above and below the at-the-money strike price, and the next ten strike prices in increments of $2.50 above the highest and below the lowest existing strike prices for a total of at least 61 strike prices. The at-the-money strike price is nearest to the previous day's close of the underlying futures contract. Strike price boundaries are adjusted according to the crude oil futures price movements.

Margins are required for open crude oil futures or short options positions. The margin requirement for an options purchaser will never exceed the premium.

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The information presented in this commodity futures and options site is not investment advice and is for informational purposes only. No guarantees are being made to its accuracy or completeness. This information can be considered a solicitation to enter into a derivatives trade. Investing in futures and options carries substantial risk of loss and is not suitable for some people. Past or simulated performance is not indicative to future results.

Trading Hours: Futures & Options.

Trading hours are in U. S. Central Time unless otherwise stated.

For products traded solely via CME ClearPort Clearing, the hours are as follows:

Sunday-Friday 6:00 p. m. - 5:00 p. m. New York time/ET (5:00 p. m. - 4:00 p. m. Chicago Time/CT) with a 60-minute break each day beginning at 5:00 p. m. (4:00 p. m. CT)

For weather products traded solely via CME ClearPort Clearing, the hours are as follows:

Sunday-Friday 7:00 p. m.- 6:45 p. m. New York time/ET (6:00 p. m.- 5:45 p. m. Chicago Time/CT) with a 15-minute break each day beginning at 6:45 p. m. – 7:00 p. m. (5:45 p. m. – 6:00 p. m. CT)

*Denotes trading hours on CME Direct Auction Platform.

*In Exchange products eligible for Trading at Settlement ("TAS") or Trading at Marker ("TAM"), TAS and TAM orders may not be entered into CME Globex from the end of a TAS trading session until receipt of the security status message indicating that the group has transitioned to the pre-open state.

* Throughout year, contract's trading hours will be adjusted for changes in both U. S. and Brazil Daylight Savings Time. See contract specifications.

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