Oil futures are a type of financial contract that allows investors to speculate on the future price of oil. They are traded on exchanges, such as the New York Mercantile Exchange (NYMEX), and allow investors to buy or sell contracts for the delivery of oil at a set price on a future date.
There are many reasons why investors might want to buy oil futures. Some investors use them as a hedge against inflation, as oil is a commodity that tends to increase in price during inflationary periods. Others use them to speculate on the future price of oil, hoping to profit from price movements. Oil futures can also be used to manage risk in oil-related businesses.