Loading
Market Intelligence › Basic Terminologies
Which factors move the price, and the character of its volatility
Published by The Retail Trader · JUL 27, 2026 · Derivatives & Commodities
Crude is one of the most traded commodities, and its price is driven almost entirely by global factors. Local demand plays a very small role in it.
On the supply side: production decisions of producer countries, geopolitical events and inventory data. On the demand side: global growth, travel and industrial activity.
Inventory data is released periodically, and sharp moves in the price at that time are normal. The timing of that release is public in advance.
Crude behaves quite differently from equity:
• A single headline can bring a very large move, in either direction.
• Trading hours are long, so the position stays live overnight too.
• The currency effect is added as well, because the international price is in dollars.
• Margin rises quickly with volatility.
Position size in crude is the biggest mistake that comes from equity habits. Work out the contract value of one lot and its normal one-day move — both first — and only then decide whether even one lot is right for your account.
This article is educational only — it is not a buy or sell recommendation, it makes no claim of guaranteed returns, and it is not advice. Rules, rates and mechanics are changed from time to time by the exchanges, SEBI and RBI, so verify every number yourself with your broker or an official source.