What are futures for Brent and Urals grades. Trade in futures for oil

Oil futures are contracts for the acquisition or sale of "black gold" in a clearly defined quantity, of specified quality and at a fixed price, which is relevant at the time of signing the contract. Futures provide for the sale of fuel in a strictly regulated volume, which is usually called a contract. A financial instrument is used to insure market players against unexpected fluctuations in prices.

Trade in oil futures: what to look for?

Acquiring or selling oil futures, it is necessary to analyze a large amount of information that will allow forecasting the direction of price movement in the near future. On the eve of the conclusion of futures agreements it is required:

• A preliminary assessment of the inflation rate;

• Assessment of the state of the resource base in the medium term;

• Studying the possibilities of making technological decisions that can affect the cost of production and transportation of fuel;

• Study of the political situation of countries that are engaged in oil production and pumping.

Specificity of trade

All futures for oil can be traded through terminals. Buying a certain amount of oil at a set price and a certain brand, it is not necessary to think about a place to store fuel or have direct contact with it. The contract for fuel delivery is resold before its completion. The trader earns or loses on the difference in price at different intervals. For the convenience of traders, contracts for the purchase or sale of oil are indicated by quotations, which may vary depending on the brand of the product being purchased or sold. Each broker offers its own symbols depending on the brand of the product.

Introduction to varieties

Each grade of oil has its own characteristic composition with a certain amount of impurities and sulfur concentration, it is distinguished by a certain list of properties. These parameters determine not only the quality, but also the level of uniformity of the composition.

The most popular among traders has been the futures for Brent crude for many years. This is "black gold" from Britain and the United States. The marker mark also includes the following fuel brands:

• WTI (USA);
• Light Sweet (USA);
• Urals heavy (Russia);
• Siberian Light Light (Russia);
• Statfjord (Norway);
• Kirkuk (Iraq);
• Iran Light (Iran);
• Iran Heavy (Iran).

Any futures for oil Forts (futures market) offers to buy all interested parties. To start trading, you will need seed money and basic software.

Futures for Brent crude oil and Urals grades

Most actively in the international market futures for oil of American brands Brent and Light are traded. The cost of these fuel brands is used to calculate other fuel brands. The result of this approach to financial instruments makes futures for Brent crude oil and Urals grades interrelated, as the market value of the latter is calculated based on the cost of the first. Thus, the US plays the role of a "regulator". One decision of the state authorities can change the destiny of entire branches of activity of other countries of the world.

In connection with the huge number of factors that can modify oil futures, only the reference product types are considered to assess the situation on the market. They are traded on the largest commodity exchanges:

• New York Stock Exchange;

• London Stock Exchange;

• Singapore Stock Exchange.

The possibility to trade in fuel is offered by the Forex market and individual dealing centers. The service can be provided by large international companies.

Specificity of futures trading on the Forex market

The most popular and most acceptable is trading in oil futures in the Forex market. The process of trading is reminiscent of manipulating currency pairs. The difference is noticeable only in the amount of leverage and in the amount of margin. One contract expresses the price for 100 barrels of oil in US dollars and provides for the transfer of fuel to the buyer. Until the moment of delivery, the matter does not reach, since the trader sells not before the expiry of the contract for its purchase.

Brent crude oil futures are called CFD contracts. They are usually referred to over-the-counter financial instruments. They provide for cash settlement and have a specific date of its expiration. Depending on the broker, contracts for oil of different brands will have their quotes. Studying the nomenclature is necessary until the conclusion of the contract.

The main players in the futures market are hedgers and speculators. Hedgers are called players who are directly related to the extraction, processing and transportation of oil and petroleum products. Participating in the bidding, they completely avoid the risks associated with the fall in fuel prices. Speculators earn on the difference in the value of contracts. They buy oil on kickbacks and sell it as soon as it rises a little in price.

Is the game worth the candle?

Using futures for Brent oil or contracts of any other brand of fuel as a trading instrument, you can make good money. The risk is much greater than when trading currency pairs. The essence of the trade is simple. It is necessary to purchase contracts as cheap as possible, and sell them at a higher price. High profitability and risk are due to large volumes of goods sold.

All that is required from a novice trader in this segment is registration on the exchange, which provides access to trading on the futures market. Alternatively, you can apply to a dealing company that has direct access to futures trading. With a dealer to cooperate more profitable. The intermediary for 2% of the amount of the transaction will assume all the subtleties of registration of taxes and bills.

Recently, trade in oil has become incredibly profitable. This is due to the fact that the price charts this year reached their historic highs. Despite the kickbacks that can be observed today, and reaching a mark of some sorts of fuel at $ 69 per barrel, experts call the situation temporary. Everyone talks about a strong pullback. In the future, another long-term price increase and the formation of new historical peaks are expected.