The NYMEX WTI crude oil futures contract, covering 1,000 barrels and ticking in $0.01 ($10).
CL is the benchmark for US crude. It is physically deliverable, so traders must roll before expiry, and it is sensitive to inventory reports (Wednesday EIA data), OPEC decisions, and geopolitics.
Its curve swings between contango and backwardation more than most products. In April 2020 the front month briefly traded below zero.
Example: oil at $80 means a contract notional of $80,000. A $2 move is $2,000 per contract. The micro contract (MCL) is 100 barrels, so the same move is $200.
Original diagrams for the ideas on this page. Illustrative, not real market data.
Contango and backwardation. A futures curve shows what buyers will pay for delivery in one month, two months and so on. When later contracts cost more than the spot price the curve is in contango; when they cost less it is in backwardation.
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