Crude oil is refined to produce products like diesel, heating oil, gasoline, jet fuel and various petrochemicals. Crude oil is available in various grades, which are named on the location they are extracted from. On an average, crude oil worth INR 2500 Cr is traded daily, making it one of the biggest contracts to be traded on MCX. The lot size for crude oil is 100 barrels, while that of crude oil mini is 10 barrels. The price quote of crude oil contract is per barrel. One barrel holds as much as 42 gallons of crude oil. The crude oil mini price today, on 21st October 2019 is INR 3,993.00 per barrel.
New contracts of crude oil are released every month. A crude oil contract has its scheduled expiry of six months from its launch date. There are two types of crude oil contract- Crude oil and Crude oil mini. The crude oil mini contract is a big favourite amongst investors. The reason for this is simple. The margin required is much lesser than the crude oil contract. The profit and loss per tick are lower, and studies show that people prefer to face a lesser loss than gain higher profits.
Factors Affecting Demand
Emerging economies such as China, India have an increasing demand for crude oil. This demand has a direct impact on the crude oil mini rate. The rise in levels of energy consumption results in an increasing demand for crude oil mini since the reserves are limited. Lack of capital directed at the discovery of new reserves of oil also affects the crude oil mini price. These factors ensure that crude oil mini price increases successively. The worth of the US dollar also has a major impact on the price of oil. Crude oil mini price is also closely tied to the stock market.
The crude oil mini price is an indicator of the on-spot prices of different barrels of oil. The crude oil mini rate has a strong influence on the economic development of the world as a whole since our industries are so heavily dependent on crude oil.
The market for crude oil mini is often fluctuating. Major events that can result in the oil prices fluctuating unpredictably can happen overnight. These changes can happen throughout the day, affecting the crude oil mini rate.