TL;DREnergy futures cover crude oil (CL), natural gas (NG), and refined products like gasoline (RB) and heating oil (HO). Crude oil is the second most traded commodity future after ES. Energy markets are physically delivered, highly volatile, and sensitive to inventory reports, OPEC decisions, and weather.
Energy futures are contracts on physical energy commodities. The most important is WTI Crude Oil (CL), which represents 1,000 barrels of light sweet crude oil deliverable at Cushing, Oklahoma. Natural Gas (NG) represents 10,000 MMBtu deliverable at Henry Hub, Louisiana.
Unlike equity index futures, most energy contracts are physically settled. If you hold a CL contract to expiration, you are obligated to take or make delivery of 1,000 barrels of actual crude oil. Retail traders must close or roll their positions before first notice day.
Energy futures trade monthly, not quarterly. A new CL contract expires and a new one becomes the front month every month. This means rollover happens 12 times per year instead of 4.
Crude Oil (CL) is the flagship energy contract. Each point is worth $1,000 (1,000 barrels x $1.00). Tick size is $0.01 ($10.00 per tick). Daily volume exceeds 1 million contracts. CL is highly liquid during RTH but can have wider spreads overnight.
Natural Gas (NG) is extremely volatile. Each point is worth $10,000 (10,000 MMBtu x $1.00). Tick size is $0.001 ($10.00 per tick). NG can move 3-5% in a single session, making it one of the most volatile major futures contracts. Not recommended for beginners.
RBOB Gasoline (RB) and Heating Oil (HO) are refined product futures. Each represents 42,000 gallons. They track the cost of wholesale gasoline and heating oil respectively. Lower volume than CL and NG.
Micro Crude Oil (MCL) is 1/10th the size of CL at 100 barrels ($100 per point). Ideal for smaller accounts wanting energy exposure.
Weekly inventory reports from the EIA (Energy Information Administration) are the most important regular catalyst. Crude oil inventories are released every Wednesday at 9:30 AM CT. Builds (more supply) push prices down. Draws (less supply) push prices up. NG storage data comes out every Thursday.
OPEC and OPEC+ production decisions directly impact crude oil supply. When OPEC cuts production, prices tend to rise. When they increase output, prices tend to fall. These decisions are made at scheduled meetings but can also come as surprises.
Geopolitical risk is a constant factor. Conflicts in oil-producing regions (Middle East, Russia), sanctions, shipping disruptions (Strait of Hormuz, Red Sea), and trade disputes all affect supply expectations and risk premiums.
Weather drives natural gas prices more than any other factor. Cold winters increase heating demand. Hot summers increase electricity demand (for air conditioning). Hurricane season (June-November) can disrupt Gulf of Mexico production.
Energy futures trade on CME Globex from Sunday to Friday, 5:00 PM to 4:00 PM CT, with a daily 60-minute break.
The primary session for CL is 8:00 AM to 1:30 PM CT. This is when liquidity is deepest and the EIA inventory report is released (Wednesday at 9:30 AM CT).
Energy markets are sensitive to global events around the clock. Asian and European sessions can see significant moves on geopolitical news, production announcements, or weather events.
The 60-minute daily break (4:00-5:00 PM CT) applies to all CME energy products.
Commercial hedgers are the backbone of energy futures markets. Oil producers (ExxonMobil, Saudi Aramco), refiners, airlines, and shipping companies all use futures to lock in prices and manage risk. This is why energy futures exist.
Speculators and prop firm traders trade CL for its volatility and liquidity. A $1.00 move in crude oil is worth $1,000 per contract, creating significant profit potential. CL is a popular choice for funded accounts.
Algorithmic traders and CTAs (Commodity Trading Advisors) actively trade energy futures using trend-following and mean-reversion strategies.
Retail traders should approach energy futures with caution. CL moves fast, the contract size is large ($70,000+ notional), and the physical delivery requirement adds complexity that equity index futures don't have. Start with MCL if you want energy exposure.
| Symbol | Name | Exchange | Point value | Tick size | Tick value | Settlement | Months | Micro |
|---|---|---|---|---|---|---|---|---|
| CL | Crude Oil (WTI) | NYMEX | $1,000 | $0.01 | $10.00 | Physical | Monthly | MCL ($100/pt) |
| NG | Natural Gas | NYMEX | $10,000 | $0.001 | $10.00 | Physical | Monthly | QG ($2,500/pt) |
| RB | RBOB Gasoline | NYMEX | $42,000 | $0.0001 | $4.20 | Physical | Monthly | None |
| HO | Heating Oil | NYMEX | $42,000 | $0.0001 | $4.20 | Physical | Monthly | None |
Trading hours: Sun-Fri, 5PM-4PM CT. Verify current specs with the exchange.