NYMEX Crude Oil Futures and Crude Oil
Options Market
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Futures Trading E Guide
Dear clients and students of the commodity markets, the
following information should answer all of your questions about crude oil
futures and options. You may also call 800-915-4716 or email
tkfutures@earthlink.net your crude oil future
and crude oil options questions to be answered by a seasoned professional.
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
and crude oil future contracts or gasoline futures
and crude oil futures. The NYMEX crude oil future
contract may be the most important energy future contract in the world.
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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.
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data or click here now
open an account to open your crude oil future or
crude oil options account today.
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.
Light, sweet crude oils are preferred by refiners because of their low sulfur
content and relatively high yields of high-value products such as gasoline,
diesel fuel, heating oil, and jet fuel. The NYMEX Light sweet crude oil future
contract is considered by many the premiere oil future contract.
The e-miNYsm crude oil future contract, designed for investment
portfolios, is the equivalent of 500 barrels of crude, 50% of the size of a
standard crude oil future contract.
The Brent blend crude oil futures contract is based on a light, sweet North Sea
crude oil that serves as a benchmark grade and widely trades as a differential
to the NYMEX Division's bellwether light, sweet
crude oil futures contract. Most of the crude oil is refined in Northwest
Europe, but significant volumes move to the U.S. Gulf and East Coasts.
Complementing the Brent crude oil future contract are an options
contract and an options contract on the
Brent/West Texas Intermediate-WTI crude oil futures spread.
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).
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Contract Specifications
Light, Sweet Crude Oil Future
Contract
Trading Unit
Crude Oil Futures: 1,000 U.S. barrels (42,000 gallons).
Crude Oil Options: One NYMEX Division light, sweet crude oil futures contract.
Price Quotation
Crude Oil Futures and Options: Dollars and cents per barrel.
Trading Hours
Crude Oil Futures and Options: Open outcry trading is conducted from 10:00 A.M.
until 2:30 P.M.
After hours crude oil futures trading are conducted via the NYMEX ACCESS®
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 7:00 P.M. All times are New York time.
Trading Months
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 (1¢) 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 options: 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 options: Trading ends three business days before the underlying futures
contract.
Options Strike Prices
Twenty strike prices in increments of $0.50 (50¢) 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.
Margin Requirements
Margins are required for open crude oil futures or short options positions. The margin
requirement for an options purchaser will never exceed the premium.
Trading Symbol
Futures: CL
To see more about the energy futures visit
unleaded gas futures,
heating oil futures
and natural gas futures.
Also visit
Crude Oil Futures Special
Report
To open an account click online future trading.
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