Oil is one of the world’s most critical and valuable natural resources, with the price of the commodity affecting
consumers every day by influencing the cost of certain goods and affecting heating, petrol or gasoline prices.
Crude oil is the world’s most actively traded commodity and the two most heavily traded contracts on crude oil are
the Brent Crude Oil contract and the West Texas Intermediate (WTI) Light Sweet Crude Oil contract.
WTI Light Crude oil is crude oil of a very high quality, mainly refined in the Midwest and Gulf Coast region of the
United States. It is considered the major benchmark of crude oil in the Americas.
Futures contracts of WTI Crude Oil are traded on both the InterContinental Exchange (ICE) and New York Mercantile
Exchange (NYMEX) and in Dubai by the Dubai Gold and Commodities Exchange. Light Crude futures are traded in units
of 1,000 US barrels (42,000 gallons) with prices quoted in US dollars.
Spreadex quotes Light Crude in dollars and cents and you trade per cent movement meaning it can be a fairly volatile
market for spread betting with regular intra-day movements of 100 – 150 points.
When placing a financial spread bet with Spreadex on the future price of Light Crude, you can trade on either a
Daily Future market or Futures markets with prices quoted based on expiry at a given future date. For example, Spreadex
may quote Light Crude, Daily Future at 86.05-86.11.
If you wish to spread bet on the price of Light Crude and you believe the value of Light Crude will rise, you
would buy on the price. If you believe it will decrease, you would sell on the price. If your trade is successful
you will win the number of points difference multiplied by your stake. If your trade is unsuccessful you will lose
the number of points difference multiplied by your stake.
When placing financial spread bets on oil, there are several factors to consider which can have a key influence on
the price. These include the supply of oil including stockpiling and any potential bottlenecks in production,
including those implemented by oil producers to force price rises. The demand for oil, such as during summer when
people may be more likely to use their cars or during winter when heating is turned up, should also be taken into
account. As Light Crude’s price is quoted in US dollars, any fluctuations in the value of the American currency
can also influence the price of Light Crude.