An oil future is a contract to buy or sell a specific quantity of oil at a set price on a future date. It is a type of derivative contract that allows investors to speculate on the future price of oil or to hedge against the risk of price fluctuations. Oil futures are traded on exchanges, such as the New York Mercantile Exchange (NYMEX) and the Intercontinental Exchange (ICE).
There are many reasons why someone might want to buy an oil future. For example, an investor might believe that the price of oil is going to rise in the future and want to lock in a price today. Alternatively, an oil producer might want to hedge against the risk of the price of oil falling in the future.