What are heating oil futures?

Futures heating oil is contracts for future supply of heating oil. One contract is equal to 42,000 gallons (approximately 158,987 liters) of heating oil and the largest number of contracts that can not have one who is neither a producer nor a commercial end user. Futures for oil heating have an oil life of 18 months and a new one is created every month because the old expires. Prices are in US dollars (USD) for Gallon (approximately 3.8 liters) and the minimum change in the price prices is $ 0.0001. Heating oil and gasoline are oil products. The possibilities on all three products also trade. Nymex, formerly New York Mercantile Exchange, is the main exchange for trading in heating and gasoline in the US. London is home for other active and competitive trade exchange for oil products, intercontinental Exchange (ICE).

refineries are the primary source of heating oil and are likely to sell futures for heating oils if they think prices are high enough to ensure good profits. End users, such as companies that deliver to customers, could buy contracts for heating oil futures. Traders who think that oil heating prices will increase, conclude contracts for the purchase of a commodity and those who think prices will fall into contracts for sale. Merchants, whether buyers or sellers of oil futures, nor accept or accept the supply of the product. Instead, traders who were buyers would sell, and traders who were sellers, buy contracts before they have to deal with the delivery of the actual product.

merchants who will think that both the price and the market volatility will increase, could decide to buy calls. Those who expect the price to rise but fear the surprise of the disadvantages would withI could buy futures and buy. Traders who think the volatility of futures on the heating oil futures could sell both hangs and calls. Gases and calls can also be used wise by end users and manufacturers to protect themselves from large and unwelcome fluctuations in the Futures price for heating oils.