Understanding "how do oil futures work" is vital for ETF arbitrage strategies. Discrepancies between spot crude and front-month futures can create short-term profit windows. "We see the oil industry slowing and are more hesitant to invest in their business," one respondent, working in machinery manufacturing, said. Demand fluctuates with the seasons: Increased travel during summer or higher heating oil consumption in winter months can impact demand. The increasing adoption of alternative energy sources and energy efficiency improvements can also impact the oil demand. Knowledge of "how do oil futures work" is critical when quarterly earnings of oil majors approach. Futures price trends often foreshadow revenue shifts; Chevron futures-linked hedges imply stable Q2 margins.
