Crude Oil Spread Bet
The SpreadBets guide to Crude Oil Spread Betting:
|
|
|
1. About Crude Oil Spread Betting
Along with gold, crude oil is one of the most traded commodities in the financial markets. This is particularly true when it comes to spread betting.
An obvious reason for such a prominent position is the fact that crude oil products form the basis of much of modern day power, transportation and plastics manufacturing. Oil is a highly sought after commodity.
Investors who trade the crude oil markets should aware that they can be volatile.
The price of crude oil is often affected by supply factors that include:
- Severe Weather Conditions – eg Hurricane season in the Gulf of Mexico
- Conflicts – eg potential problems in the Middle East or attacks on pipelines in Nigeria
- OPEC – The Organisation of Petroleum Exporting Countries who attempt to control supply in order maintain a high price
Other oil price factors include:
- Equities prices – as the World economy recovers in 2009 and equities prices have increased, oil prices have seen a parallel rise on the basis that a recovery will lead to an increase in oil demand
- US Driving Season – America is the number one oil consuming nation and the US Driving Season is known to have an impact on oil prices as demand increases
- Weekly US Oil inventory numbers:
- High inventories suggest excess supply and a possible decrease in price
- Low inventories suggest low supply and possible increase in price
- Inventory data is typically released every Wednesday at 3.30pm UK time
When spread betting note that there are two major oil markets:
- Brent Crude Oil, also known in spread betting as UK Crude Oil
- US Crude Oil, also known as WTI (West Texas Intermediate), Nymex Crude Oil and Light Sweet Crude.
Spread bets on either crude oil market allows an investor to take a long, or a short position on the future price of crude oil. So if, after suitable research, you believe that the oil market will slump, you can spread bet on oil to go down.
Spread betting on oil is leveraged and so whilst you can win more than your initial stake you can also lose more than your initial stake. This means that you should be fully aware of the potential benefits and pitfalls before placing any trades.
2. Where can I Financial Spread Bet on Crude Oil?
Crude Oil |
 |
 |
 |
 |
 |
 |
 |
| UK Oil Daily (Brent) |
 |
|
|
 |
|
|
|
| UK Oil Future (Brent) |
|
|
|
|
|
|
|
| US Oil Daily (WTI) |
|
|
|
|
|
|
|
| US Oil Future (WTI) |
|
|
|
|
|
|
|
The above spread betting markets may also be available with other companies. Also see Comparison Table Notes.
3. How to Spread Bet on Crude Oil
As with many markets, you can spread bet on the future value of commodities. In this case you can spread bet on the Brent Crude Oil (August) market closing higher than $132.61 per barrel on 14-Jul-08.
With Crude Oil markets, you trade in £x per ¢, where a ¢ is $0.01 of Brent Crude Oil movement. For example if your stake was £3 per ¢ and the Crude Oil price moves by $0.90 then that would be a £270 difference to your profit (or loss).
$0.90 x £3 per ¢ = 90¢ x £3 per ¢ = £270.
So let's say you check the live prices on an online spread betting service like Financial Spreads, which shows the above spread of $132.56 - $132.61, and you believe that the Crude Oil market will finish higher than $132.61.
- You think that Brent Crude Oil (August) will close higher than $132.61
- So you go long (buy) crude oil. You invest £2 per ¢
- The price of a barrel of crude oil increases. You let your bet run to the settlement day, 14-Jul-08
- The market settles at $133.90
- Opening price = $132.61
- P&L = (closing level - opening level) x stake
- P&L = ($133.90 - $132.61) x £2 per ¢ stake
- P&L = ($1.29) x £2 per ¢ stake
- P&L = 129¢ x £2 per ¢ stake
- P&L = £258 Profit
Of course, it is not always that easy and the oil market can be unpredictable. If this Crude Oil Futures market did not work out for you, with the market closing lower at $131.50, then you would have lost on this spread bet.
- Opening price = $132.61
- P&L = (closing level - opening price) x stake
- P&L = ($131.50 - $132.61) x £2 per ¢ stake
- P&L = -$1.11 x £2 per ¢ stake
- P&L = -111¢ x £2 per ¢ stake
- P&L = -£222 Loss
Prices correct as of 16-Jun-08
Oil Spread Betting Notes:
- You can spread bet on Crude for as little as £1 per ¢ or €1 per ¢ with GFT, IG Index, Spreadex and FinancialSpreads.com
- Both US Crude Oil and Brent Crude Oil are priced in US$. Therefore the price of Oil will ‘often’ increase when the US Dollar decreases against the Euro and Sterling. Likewise Crude Oil will ‘often’ go down when the Dollar strengthens
4. Where can I find Real-Time Crude Oil Spread Betting Prices?
All of the above companies provide access to real-time indices prices to their account holders.
Note that you may need to log into your account in order to see the live Crude Oil prices.
Advert
Financial Spreads
Spread Betting - No Fees, No Commissions, Free Charts and Live Prices.
Spread Bet on Indices, Forex, Commodities, Shares and more. For details see Financial Spreads.
|
5. Where can I find Crude Oil Candlestick Charts?
A number of the spread betting companies offer a variety of charts, including candlestick charts. Note that you may need to open an account with the respective company in order to see the charts and/or have full access to real-time charts that you can manipulate. Spread betting accounts are subject to status, terms and conditions.
Candlestick charts are currently available with:
Charts may also be available from other spread betting companies.
Example commodities charts from Financial Spreads:
Above: UK Crude Oil - 30 Min Candlestick Chart:
Below: US Crude Oil - Weekly Candlestick Chart:
Advert
Financial Spreads
Spread Betting - No Fees, No Commissions, Free Charts and Live Prices.
Spread Bet on Indices, Forex, Commodities, Shares and more. For details see Financial Spreads.
|
"Crude Oil Spread Bet" last update by RThomas, 10-Feb-2012
Warning: Financial spread betting carries a high level of risk. You can lose more than your initial investment or stake. Financial spread betting may not be suitable for all investors. Only trade with money that you can afford to lose. Make sure you fully understand the risk involved. If necessary, seek independent financial advice.
Similar articles:
Crude Oil Spread Bet - last update: 10-Feb-2012
Crude Oil Spread Bet - the complete guide to crude oil spread bets: where to find crude oil prices, crude oil charts, crude oil spread betting examples, brokers that offer crude oil futures markets and . . . read more - Crude Oil Spread Bet.
Gold Spread Bet - last update: 10-Feb-2012
Gold Spread Bet - an in-depth guide to gold spread bets: where to find gold prices and charts, gold spread betting examples, companies that offer the gold markets and . . . read more - Gold Spread Bet.
Commodities Spread Bet - last update: 10-Feb-2012
Commodities Spread Bet - the complete guide to commodities spread bets: where to find commodities prices, commodities charts, commodities spread betting examples, companies that offer commodities markets and . . . read more - Commodities Spread Bet.
Commodity Spreads - last update: 31-Jan-2012
Commodity Spreads - a look at which spread betting firms offer commodity spreads and commodities charts, where to find live commodities spreads, how to spread bet on the commodity markets and . . . read more - Commodity Spreads.
US Crude Oil Spread Bets - last update: 08-Feb-2012
US Crude Oil Spread Bets - the complete spread betting guide to the US Crude Oil market: where to find US Crude Oil spread bets, real-time US Crude Oil spread betting prices and commodities charts, plus how to spread bet on US Crude Oil as well as . . . read more - US Crude Oil Spread Bets.
Silver Spread Bets - last update: 08-Feb-2012
Silver Spread Bets - the complete guide to the Silver spread betting market: where to find Silver spread bets, live Silver spreads prices and commodities charts, plus how to spread bet on Silver and . . . read more - Silver Spread Bets.
Copper Spread Bets - last update: 08-Feb-2012
Copper Spread Bets - the complete spread betting guide to Copper: where to find Copper spread bets, live Copper spreads prices and commodities spread betting charts, plus how to spread bet on Copper as well as . . . read more - Copper Spread Bets.
10 Crude Oil Spread Trading Facts - last update: 31-Jan-2012
The Crude Oil markets can move a lot on rumour, news of supply problems in the Gulf of Mexico, news of OPEC increasing production levels, changes in USD exchange rates etc but what about the Facts? . . . read more - 10 Crude Oil Spread Trading Facts.
Spread Betting on the Price of Gold - last update: 05-Aug-2011
One way of trading gold is by opening an account with a spread betting firm. When spread betting on gold you are merely trading on the direction of the gold market. This is . . . read more - Spread Betting on the Price of Gold.
How to Trade the Crude Oil Market - last update: 30-Jun-2011
The traditional way to trade the crude oil market involved actually buying oil. If you had enough money, you could buy your own oil well or buy and sell shares in oil companies. With crude oil spread betting, you can . . . read more - How to Trade the Crude Oil Market.
2011 Crude Oil Spread Betting Forecasts - last update: 16-Feb-2011
The International Energy Agency, in its 2010 World Energy Outlook report, said regular crude oil output had peaked and would be likely to level-out in the course of the next decade . . . read more - 2011 Crude Oil Spread Betting Forecasts.
Financial Spread Betting on the Gold Market - last update: 30-Nov-2010
Recently, the gold market has continued to find new record levels on a regular basis, however for the time being, the market appears to be struggling. We have seen many . . . read more - Financial Spread Betting on the Gold Market.
Resistance Levels and the Crude Oil Spread Betting Market - last update: 06-Jul-2010
As with most recent market moves, a weakening US Dollar has translated into rising stocks, oil and gold prices. Looking more closely at the crude oil spread betting market . . . read more - Resistance Levels and the Crude Oil Spread Betting Market.
Shares Spread Betting - last update: 01-Feb-2010
Shares Spread Betting >> Trading stocks and shares is not always easy. However, if you are looking to trade then it is worth having a look at some of the easiest ways to access the global equities markets. Spread betting offers a tax free* solution that . . . read more - Shares Spread Betting.
Betting on a Crude Oil Price Fall - last update: 01-Dec-2008
Financial Spreads and paddypowertrader have both reported a surge in clients selling oil. The latter has confirmed a 25% increase in the number of accounts shorting crude. Prices have slumped by more than 60% . . . read more - Betting on a Crude Oil Price Fall.
Spread Betting on Soft Commodities - last update: 17-Oct-2008
Spread Betting on Softs >> Although less popular than Metals or Energy-based Commodities like Crude Oil, Softs like Coffee still provide plenty of opportunity for anyone trading CFDs or spread betting. Or do they? . . . read more - Spread Betting on Soft Commodities.
Spread Bets and the Golden Safe Haven - last update: 01-Oct-2008
Spread Bets and the Golden Safe Haven >> Talking to a number of spread betting companies recently I found out that despite gold hitting an all-time high of $1,030 in March and steadily falling since then many clients have remained positive about the . . . read more - Spread Bets and the Golden Safe Haven.
Crude Oil Spread Betting Predictions - last update: 24-Jul-2008
Crude Oil Spread Betting Predictions >> Are all the analysts still predicting a rise in crude oil prices? Which way should you bet on Oil to go next, up or down? We have scoured the financial press for reputable sources predicting a drop in oil prices. There are not many. Of course the negatives with this sort of research come in three forms of self interest. Firstly, the . . . read more - Crude Oil Spread Betting Predictions.
Spread Bet on Gold - last update: 24-Aug-2011
How to spread bet on gold plus useful links to commodities trading tips, software and . . . read more - Spread Bet on Gold.
Spread Betting on UK Crude Oil - last update: 24-Aug-2011
Crude Oil prices continue to be high. The Brent Crude Oil (November) market is currently trading at $73.80 - $73.85 with FinancialSpreads.com and whilst . . . read more - Spread Betting on UK Crude Oil.
|
|
|
Free Financial Email: Latest Spread Betting Offers and where to find narrow spreads.
Click here to sign up.
|
|
