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Crude Oil futures prices could go negative again in a repeat of the May 2020 futures contract expiration.

Crude Oil Futures

The CFTC (Commodity Futures Trading Commission) is warning that the New York Mercantile Exchange’s Crude Oil futures contact could drop into negative territory as expiration of the June 2020 contract approaches.

In a CFTC advisory, the regulator reminded exchanges, futures brokers and clearing houses that “they are expected to prepare for the possibility that certain contracts may continue to experience extreme market volatility, low liquidity and possibly negative pricing.”

The June 2020 WTI futures contract will expire on May 19, 2020 and the markets should prepare for a possible repeat of last months, May 2020, WTI futures contract price dropping into negative territory.

Fortunately, when this occurred – for the first time in history, the futures market was able to handle it…

CME Group Inc. Chief Executive Terry Duffy told CNBC in the days following the slump into negative territory in the May contract that the exchange and regulators had been prepared for that possibility and that the “futures market worked to perfection.”

As of this writing, the June 2020 WTI futures contract is trading at a price of 26.23 +0.94 per barrel.

Insignia Futures & Options is closely monitoring this situation and is in contact with clients who are trading the Crude Oil futures market.

To learn how to take advantage of changing prices, up or down, with futures and options, please feel free to contact me directly.

If you don’t already have a futures trading account with Insignia Futures & Options, I invite you to open one today…

Best Wishes,

Joe Fallico

Principal Futures Broker
Series 3 & Series 30 Registered

Phone: 1-847-379-5000 ext. 101
Toll Free: 1-866-892-2030ext. 101

Insignia Futures & Options, Inc.

* Required disclaimer:
There is a risk of loss in futures trading.  Past performance is not necessarily indicative of future results. The use of a stop loss order may not necessarily limit your loss to the intended amount. You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources.