Reading Time: 6 Minutes
Crude oil, commonly referred to as ‘black gold’, is a highly sought-after energy source and commodity worldwide.
The market volatility and global demand surrounding this energy space make it a potential asset for both traders and investors.
Crude oil trading represents an essential segment in the global commodities market, given its vital role in powering industries, transportation networks and energy supplies. Its growth is also affected by geographical factors as well as technological innovations and economic policies that impact economies globally.
Brent Crude, sourced from the North Sea, serves as one of the two primary benchmarks driving crude oil trading today, accounting for two-thirds of globally traded volumes. Its price fluctuates due to factors like changes in regional production levels, political unrest in producing nations or fluctuations in oil consumption patterns. Brent plays an especially vital role for nations reliant on imported fuel, such as those found across Europe, Africa, or Middle Eastern regions that rely heavily on imported supplies.
West Texas Intermediate, or ‘WTI’, in comparison, is a lighter crude that's ‘sweeter’ compared to Brent crude oil. WTI refineries mainly reside in the Midwestern and Gulf Coast regions within the USA. Its pricing ties in closely with domestic supply-consumption balances, US economic indicators, and stockpile levels reported by the Energy Information Administration (EIA).
OPEC, or the ‘Organisation of the Petroleum Exporting Countries’, is a key part of trading crude oil. With members that include some of the biggest oil suppliers in the world, its policies and production choices can have a big effect on the quantity of oil around the world and, by extension, on prices. Traders should pay close attention to this organisation's meetings and reports because their choices could impact the prices of Brent Crude and WTI.
Trading with CFDs:
Contract for Differences (CFDs) allows traders to speculate (and hedge) on oil's current market value without taking ownership of the underlying asset (in this case, the physical commodity), offering both flexibility and accessibility. This form of trading can provide opportunities to generate a return from both rising and falling markets.
FP Markets facilitates access to the global energy markets through oil CFDs. For example, traders can engage with the global energy sector through the WTI CFD against the US dollar (XTI/USD) nearly 24 hours a day, five days a week, on the MetaTrader 4 (MT4) trading platform (you can also access this market through MetaTrader 5 [MT5] and cTrader). The window for active trading opens at 01:00 am on Monday, inviting traders to participate until midnight each day until Thursday. On Friday, however, the trading session concludes a little earlier at 23:45.
Traders and investors also have the option of trading WTI Crude Oil Futures CFDs. The trading hours begin at 01:00 am on Sunday and extend around the clock until 24:00 from Monday to Friday (note that trading sessions end at 23.45 on Friday).
Also offered at FP Markets are Brent Crude Oil CFDs (denoted by the symbol XBR/USD). There’s a slight difference as the trading times is from 03:00 am to 24:00, Sunday until Thursday. On Friday, trading ends a little bit earlier at 23:55.
Futures and Options:
Although crude oil trading doesn't follow a 9-5 schedule, its trading hours provide traders worldwide an opportunity to participate without becoming sleep-deprived zombies.
Sign up for a demo account with FP Markets and test-drive our world-class Trading Platforms today. With FP Markets, you have access not only to an extensive range of energy products but also a wide selection of popular markets, such as Currencies, Stocks, Global Indices, ETFs (Exchange-Traded Funds), Bonds and Digital Currencies.
Source - cache | Page ID - 37648