Crude oil is the longest commodity due to its current irreplaceability in the world economy. In recent months, the price of oil has reached new highs. Try to invest in oil, you can also earn money on the fall in its price.
Not only is the price of oil reaching record levels and the price of fuel at filling stations is rising, newspaper headlines are also full of expert opinion, which is currently affecting the price of oil on world markets as much as possible. In recent years, it has been mainly an offer on the market. Oil d svt, and therefore any shortfall in supply on the market will cause an immediate increase in price.
At the moment, the most frequent talk is about the lack of supply and the weak dollar. The truth is that the demand for oil worldwide is growing, but not at a rate that would justify the increase in prices in the last year. These are concerns about the future supply, which the market will anchor in the current price.
The record weak dollar thus has its share in the record prices of black gold. Oil is quoted in USD, which is why the weak dollar makes oil cheaper for non-dollar investors. The unfavorable situation on the financial markets, which has lasted since the middle of last year, thus stimulates investments in oil and other commodities, for which the current situation has potentially increased growth, for example in the stock markets.
You can speculate on a decline
As with other commodities, oil trade is speculated to decline. This can be done in a trading futures contract or CFD, a contract for a settlement difference. The most traded are contracts for the American light oil WTI (West Texas Intermediate) traded firmly on the New York Commodity Exchange (NYMEX). However, this contract can also be traded, for example, on the International Commodity Exchange in London (ICE), where most contracts are traded for North Sea Brent crude oil. In London you can trade acid oil from the Middle East (Middle East Sour Crude) and in New York you can trade Brent oil.
Futures contracts can be used by real oil traders who are interested in the physical delivery of the commodity tax, as well as speculators who repay the contract before it is executed. In the case of trading so-called CFD contracts, there is no risk of physical delivery, or if it is just an instrument, its underlying asset is the price of the futures contract.
Forwards, options, but also shares of companies
As part of the oil trade, you may be able to use a forward contract or option. Refineries use these instruments for hedging, but they can be linked to speculation on the decline and rise in price. The example of the forward is that the two parties will agree today on a delivery of 500 thousand barrels of American light crude oil in 3 months at a price of 140 USD / barrel.
Even in the case of oil, it is possible to invest in the action of a company that deals with the processing and processing of these commodities and which has shown record profits in recent years. The most important companies include the American ExxonMobil, the British BP, Royal Dutch Shell, PetroChina, the American Chevron, the Russian Gazprom or the Polish PKN Orlen.
If the investor is not sure which shares to invest in, the company can choose ETFs (Exchange Traded Funds), which monitor the development of the group of companies engaged in oil processing. Among them is the iShares S&P Global Energy Sector, which is developing the S&P index of the global energy sector. By purchasing this ETF, you run the risk of falling and rising share prices, such as Exxon Mobile, Chevron, ConocoPhillips or Royal Dutch Shell.
From where to tee oil the most
Saudi Arabia has the largest amounts of oil at its disposal with 260 billion barrels, according to which it is now the Irish city of Irk. But what is important is to be able to howl. The three largest sources in the world are in Ireland, but due to the lack of technology and other means, the Irish, as far as production is concerned, is not even in the top row of the largest producers in the world.
The largest producer is Saudi Arabia, then Russia and the United States. The United States is one of the largest oil consumers. Saudsk Arbie is again the world’s largest oil exporter, followed by Russia and Norway. The largest importers in the world are the United States, followed by Japan and the United States.