Is it possible to just buy oil? Is it on a commodities market?

I know commodities work differently. Can it be done?Is it possible to just buy oil? Is it on a commodities market?
Sure, buy a contract for 1,000 barrels of light sweet crude or the Russian Export blend (physical delivery at the Baltic Sea port of Primorsk) on the New York Mercantile exchange and when it settles you will get a delivery notice, so just tell them where to send it (which will cost you extra).Is it possible to just buy oil? Is it on a commodities market?
Yes, but you don't want to.





First, the ';oil prices'; you see don't include delivery or storage. So, if you buy oil, you have oil wherever it came from. Nigerian oil will be in Nigeria, and you have to pay to get it to a storage facility. Then, you have to pay insurance and storage costs until you sell it. It's a serious cost, and it produces no value, because the people you sell the oil to would probably rather have it in Nigeria.





That sucks. Seriously. And, if you're an ordinary joe, it's illegal for you to have underground storage tanks at home.





So, you have to go to the futures market. Basically, you buy futures, and sell them before you have to exercise them, and never actually take physical delivery of oil. There are ETF and Mutual Funds that do this for you. USO is one of them.





--%26gt;Adam
1) Yes.


2) Yes.


3) Yes.
You can buy oil through USO index fund. You can also buy oil futures contracts which are contracts for the future delivery of oil. Just liquidate them before the contract comes due. You can purchase a future contract on very low margin giving you a lot of leverage. Of course that leverage works two ways.
You can buy oil the way it is traded every business day on the commodities market. This consists of buying a futures contract on crude oil, or natural gas,, heating oil, unleaded gasoline, etc. The futures contract does provide for physical delivery of a particular commodity or item and those which call for a cash settlement. The month during which delivery or settlement is to occur is specified. A July futures contract requires delivery or settlement in July. In the event of a delivery type futures contracts, very few actually result in delivery. Preferably it is more profitable to sell an off setting contract prior to delivery date. Selling a contract that was previously purchased liquidates a futures position in exactly the same way, that selling 100 shares of IBM stock liquidates an earlier purchase of 100 shares of IBM stock. A futures contract initially sold can be liquidated by an offsetting purchase. In either case, gain or loss is the difference between the buying price and the selling price. Not many speculators have the desire to take or make delivery of the quantity of oil that is specified in each contract. For crude oil, the quantity per contract is 500 barrels of oil. Each barrel of oil equals 42 gallons. In other words the buying and selling of oil is done for the most part by wholesalers who will take either a gain or loss on the existing contract, depending if it has gone up or down in price.
You can buy oil in the spot market (e.g., buy the oil and take it home with you) -- or you can buy oil futures -- which is a contract to purchase oil at an agreed upon price at some point in the future.
No... you can't buy oil as an individual... you have to be a company for that.





It's on the commodities market and the symbol is something like ';OIX'; or ';OLX';... anyway, I tried trading it and found I couldn't because I had the wrong credentials... at least that was true about 5 years ago.