Crude Oil Commodity Futures Information
Futures Trading Contracts have a defined set of specifications. With Crude Oil the contract represents 1,000 barrels of WTI with standardized delivery dates set in the future. Contracts are available for each month of the current year and go out as far as 5 years in the future. Additionally there are June and December expirations for years 6-9 out. Each month’s expiration is set in the preceding month for the 3rd business day prior to the 25th calendar day of the month.
The price of a crude oil contract are quoted in US Dollars and Cents per barrel and the value of the contract can be calculated by taking the current futures quote and multiplying this by the size of the contract which is 1,000 barrels. As an example a crude oil price of 95.52 would be $95.52. Multiply the futures price by 1,000 barrels (95.52 x 1,000) and you will come up with a cash value of $95,520 for the crude futures contract. The market trades in standardized price movements of 1 cent which is referred to in the trading industry as 1 tick. The minimum value per tick is then $10 per crude oil futures contract.
The majority of traders do not put up the full cash value of the futures contract to trade. Exchanges and Futures Brokers allow customers to trade a futures contract by posting a fraction of the cash value of a contract. This is referred to as posting margin and is trading using leverage. Margin rates do change and you can reference them online. A very important note that using leverage to trade has risk associated with it and must be understood before trading with real money. Referencing our example of the price of crude oil above and the cash value of the contract a trader could trade a crude oil futures contract with $4,000 in margin (Day Trading margins could be less). With a cash value of approximately 95,000 you can see that you only need to post a margin that is a little more than 4% of the actual value of the futures contract.
Light Sweet Crude Contract Specifications Commodity Group Energy Futures
Exchange Contract is Traded CME Globex, CME ClearPort, Open Outcry (New York)
Hours Traded (New York Time and GMT)
CME Globex Sun-Fri 6 p.m. – 5:15 p.m.
CME ClearPort Sun- Fri 6 p.m. – 5:15 p.m.
Pit Open Outcry Mon-Fri 9:00 a.m. – 2::30 p.m.
Contract size 1000 barrels
Price Quotation US Dollars and cents per barrel
Minimum Fluctuation $0.01
Initial Price Fluctuation Limits for All Contract Months. At the commencement of each trading day, there shall be price fluctuation limits in effect for each contract month of this futures contract of $10.00 per barrel above or below the previous day’s settlement price for such contract month
Every month for 5 years out. Plus June and Dec years 6-9
Termination of Trading
3rd business day prior to the 25th calendar day of the preceding Month
(A) Delivery shall take place no earlier than the first calendar day of the delivery month and no later than the last calendar day of the delivery month.
(B) It is the short’s obligation to ensure that its crude oil receipts, including each specific foreign crude oil stream, if applicable, are available to begin flowing ratably in Cushing, Oklahoma by the first day of the delivery month, in accord with generally accepted pipeline scheduling practices.
(C) Transfer of title-The seller shall give the buyer pipeline ticket, any other quantitative certificates and all appropriate documents upon receipt of payment.
The seller shall provide preliminary confirmation of title transfer at the time of delivery by telex or other appropriate form of documentation.
Settlement Type Physical
Grade and Quality Specifications Must be WTI Crude Oil
Back Bay Futures is a Futures broker who specializes in Alternative Investments such as managed futures and forex. Pit and Electronic institutional option execution as well as self-directed and broker assisted accounts are also available.
There is a substantial risk of loss in trading futures, options and FX. Please read our full terms and disclaimers for more details of risk associated with Commodities interests.
Disclaimer: Trading in commodity interests is a challenging opportunity which involves considerable risk. Commodity Interests include; Futures, options, cash currencies and other leveraged transaction products. The valuation of futures, options, cash currencies and other leveraged transaction products may fluctuate and as a result clients may lose more than the amount originally invested and may also have to pay more later. Therefore, before deciding to participate you should carefully consider your investment objectives, level of experience and risk appetite. Most importantly, do not invest money you cannot afford to lose. Consulting with your investment counselor, attorney or accountant as to the appropriateness of an investment in margin trading and leverage transaction products is recommended. Back Bay Futures is a registered branch office of Back Bay FX Services, LLC – NFA member (0388617).