Crude Oil Futures and Options are Derivatives Contracts that give investors exposure to the international price of crude oil. The underlying Commodity is listed and traded on the New York Mercantile Exchange (NYMEX), a subsidiary of the CME Group. This product serves as a key international pricing benchmark and can be used as an effective hedging tool to manage local users’ diesel price risk. Contracts are settled in rands and can easily be accessed through
JSE Commodity Derivatives Members.
These contracts are the world’s most actively traded energy product. Typically, consumers and producers of crude oil manage crude oil price risk by buying and selling these contracts. Crude Oil Futures and Options are also traded by speculators, who assume the price risk that hedgers try to avoid in return for a chance to profit from favourable price movement.
To access Crude Oil Futures and Options, investors need do is register as a client with an authorised member firm, deposit the required initial margin and sell or buy according to their needs.