Crude oil is the raw material that is refined into gasoline, heating oil, jet fuel, propane, petrochemicals, and other products. Movements on the three major international petroleum exchanges the New York Mercantile Exchange, the International Petroleum Exchange in London and the Singapore International Monetary Exchange set the price of crude oil.
The supply and demand of crude oil is what decides the prices. They behave just like any other commodity with wide price swings in times of shortage or over supply and in times of political instability.
The price of crude oil might increase over several years. There are two types of crude oil: sour crude is primarily the type of crude that comes from OPEC, as opposed to West Texas Intermediate (WTI) or sweet crude.
The WTI price is traded on the New York Mercantile Exchange (NYMEX).Crude oil began futures trading on the NYMEX in 1983 and is the most heavily traded commodity.
It trades in units of 1,000 US barrels and the price is quoted in dollars and cents per barrel. The minimum price fluctuation in the price of crude oil is US$ 0.001 per barrel.
Crude oil Futures trading has always been of tremendous interest to speculators who hope to profit from the ever changing price of this commodity, the energy market opens on Sunday 22:00 GMT and closes on Friday 20:30 GMT. There is a daily closing for 45 minutes from 21:15 to 22:00 GMT.
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