Join us this morning and watch us trade live the Crude Oil Inventories and Natural Gas Storage report. Click here to gain access.
The Crude Oil Inventories report is released weekly, four days after the week ends. The data reports the number of barrels of crude oil commercial firms have in inventory. Commercial firms report their inventory levels to the Energy Information Administration, but the EIA must still make some estimates to arrive at the final number. It influences the price of petroleum products which affects inflation, but also impacts growth as many industries rely on oil to produce goods.
Active traders, especially those utilizing sophisticated computers such as quantitative and algorithmic trading models love this report because of the volatility in price action it can spark. The futures market is one of the most favored by active traders because of the liquidity and leverage the exchange market offers. Crude Oil began futures trading on the New York Mercantile Exchange (NYMEX) in 1983 and is the most heavily traded commodity.
Stock traders also engage by trading exchange-traded funds (ETF) including United States Oil Fund, LP : USO, PowerShares DB Oil Fund : DBO and oil related stock companies such as Exxon Mobil Corporation: XOM, Chevron Corporation : CVX, PetroChina Company Limited : PTR and BP Plc : BP.
Trading unit: Crude Oil Futures trade in units of 1,000 U.S. barrels (42,000 gallons). Options: One NYMEX Division light, sweet crude oil futures contract
Trading Months: Crude Oil Futures trade 30 consecutive months plus long-dated futures initially listed 36, 48, 60, 72, and 84 months prior to delivery. Additionally, 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. Options: 12 consecutive months, plus three long-dated options at 18, 24, and 36 months out on a June/December cycle.
Price Quotation: Crude Oil Futures are quoted in dollars and cents per barrel.
Minimum Price Fluctuation: $0.01 (1¢) per barrel ($10 per contract).