Trading Crude Oil price futures contracts is really just like trading any other type of financial instrument. The price is set up by supply and demand, and can trade from 1 penny to infinity – whatever someone is willing to pay for it. There are buy-sell limits and buy-sell stops. The only difference is there is a time limit on when these Crude price futures will trade. This is called the futures market, where you can trade an assortment of crude months – 72 to be exact. The contract trades in units of 1,000 barrels, and expires on the 3rd business day prior to the 25th calendar day of the month preceding the delivery month. The contract provides for delivery of several grades of domestic and internationally traded crudes and serves the diverse needs of the physical market.

The Crude Oil futures pit was developed mainly on the producers of the commodity to hedge themselves against their own inventory. Throw in a bunch of speculators to liquefy the market and you have one big trading ring with brokers shouting out buy and sell signals. Unfortunately, over the past two years this market has become solely electronic. They now have computer programs where at the click of a button you can execute a trade right from your own home.

You will need a margin account to trade Crude Oil futures contracts. In fact, you need a margin account to trade all types of commodities in general

Trading in futures and options involves a substantial risk of loss and is not suitable for all investors. Past performance is not necessarily indicative of future results.