Question

Why is it difficult to determine the spot price of oil?

Answer 1

one price are hard to forecast becouse they are highly sensitive to shocks in both global demand & supply

Answer 2

Answer:

Oil is primarily sold in long-term contracts, so there isn't clear spot price of oil.

Explanation:

They have a special contract, which is long term. There is no obvious spot oil price. Now there are spot oil prices but it's overwhelming majority of oil is not sold on the spot market. The spot oil price is a volatile number, it differs from place to place. Again, when you look at oil price typically when they quote that, they're quoting the nearest future contract. It's slightly in the future.