|
|
 |
 |
|
Trading Brent Crude Oil
     |
 |
What is a Brent Crude Oil (BCO/USD) contract?
Brent Crude contracts at FOREX.com trade like currency pairs, though with different margin and leverage. The BCO/USD contract represents 100 barrels (bbls) of Brent Crude, priced in US dollars.
The BCO/USD contract is a 'Contract for Difference' (CFD). CFDs are over-the-counter trading instruments with an expiry date that are cash settled.
Brent Crude is typically regarded as a "benchmark" type of crude oil, meaning it is one of the types of crude used to set the market price for oil. It is sometimes also known as "UK Oil". Brent Crude is traded on the Intercontinental Exchange.
Crude oils are classified as either Light or Heavy depending on their API gravity, and as either Sweet or Sour, depending on their sulphur content. Brent Crude is a "light, sweet" blend, gathered from several oil fields in the North Sea. It is typically priced higher than the OPEC composite price (heavier, more sour than Brent), and lower than the West Texas Intermediate (WTI) price (lighter, sweeter than Brent), since its quality lies between the two. (Source: The Energy Information Administration). The name "Brent" comes from the oil fields in the Northern Atlantic where the oil is extracted.
Trading hours
Trading hours for the BCO/USD product begin Sunday at 20:00 EST (01:00 UK time) and trade daily until 17:00 EST (22:00 UK time) Friday.
There is a daily break in trading from 18:00 EST (23:00 UK time) until 20:00 EST (01:00 UK time).
On the monthly expiration date, trading in the contract will expire at 14:30 EST (19:00 UK time) - Read more about contract expiry
Trading hours for the FOREX.com BCO/USD contract will also be impacted by exchange holidays.
Who Trades Brent Crude, and why?
Trading in petroleum products spans many industries, and as such, is affected by both high-level geopolitical factors, as well as the trading activities of speculators. Players in the global oil trade range from entire economies, to large corporations, to traders on exchanges, down to the average daily consumption of gasoline in your car. Airlines may use oil trading to protect against an anticipated price increase, and Wall Street traders may trade oil futures to attempt to profit from market movements. The factors that may influence the price of Brent Crude oil are similar to that of a currency pair, in that they are affected by market-forces. These can be political, financial, or even weather-related.
How is the FOREX.com Brent Crude price derived?
FOREX.com's price for BCO/USD is derived from the price of Brent Crude futures trading on the Intercontinental Exchange (ICE).
Our price is derived from the current (front month) price of the ICE contract up to the 2nd Wednesday of each month, Between that date and the expiry date of the ICE contract, the FOREX.com BCO/USD contract will be priced from the next futures contract month to avoid expiry-related volatility. Read more about contract expiry.
|
|
|
 |
|
|
 |
|
|
