WTI Crude Oil Futures (NYMEX CL)

Physical delivery at Cushing

A trader still holding a long CL position when trading ends must accept 1,000 barrels per contract at Cushing, Oklahoma, during the delivery month. A short must deliver them. Because of this physical link, the WTI price stays tied to real supply and storage at one inland hub.

• When Cushing stocks are high and storage is scarce, the front month weakens against later months (contango) to pay for storage.
• When Cushing stocks are low, the front month strengthens (backwardation), sometimes sharply into expiry.

Most speculators and funds close or roll positions days before the last trading day, during what traders call "the roll". The most extreme failure to do so came on 20 April 2020, when the May contract settled at −$37.63.

Working out the last trading day

Start with the 25th calendar day of the month before the contract month and count back three business days. If the 25th is a weekend or holiday, count back three business days from the last business day before the 25th. Examples:

• The December contract stops trading around 20 November.
• The January contract stops trading around 18–21 December, because 25 December is always a holiday.

Because WTI expires around the 20th and Brent at the end of the month, the two benchmarks' front months are not always for the same delivery month. Keep that in mind when comparing quotes.

The WTI futures curve

As with Brent, the shape of the curve shows market balance: backwardation for a tight market and contango for a surplus. The calendar spread between the first two CL months is one of the most-watched indicators of US storage tightness. Many traders look at the curve alongside the EIA's Wednesday Cushing inventory figure.

WTI futures vs other ways to trade WTI

• CL futures: 1,000 barrels, physically delivered, the deepest liquidity.
• Micro WTI (MCL): one-tenth the size and cash-settled, popular with smaller traders.
• Options on CL: for hedging or for trading volatility.
• ETFs such as USO hold near-dated futures and roll them. In contango, rolling costs can make long-term returns very different from the spot price.
• CFDs (outside the US) track the futures price with broker financing costs.

Futures and leveraged products carry a high risk of loss. This page is educational and not a recommendation to trade.