Playing the Commodities Markets

I ask Grok if I had invested $10,000 in oil futures on February 3, 2025, how much would I have lost?

To determine how much you would have lost if you invested $10,000 in oil futures on February 3, 2025, we need to consider the price movement of oil futures between February 3, 2025, and today, April 7, 2025. Since I don’t have exact daily price data for oil futures contracts in that specific period, I’ll outline a general method to calculate this based on available information and reasonable assumptions. Here’s how it works:

Oil futures are typically traded on exchanges like the CME Group (e.g., WTI Crude Oil Futures), with each contract representing 1,000 barrels of oil. The price is quoted in dollars per barrel, and your investment would depend on how many contracts you could purchase with $10,000, factoring in margin requirements (since futures are leveraged instruments). Your profit or loss would then depend on the price change per barrel, multiplied by the number of barrels you control.

Step-by-Step Approach:

1. Initial Investment and Margin: Futures trading doesn’t require you to pay the full value of the contract upfront; instead, you post an initial margin (typically 5-10% of the contract’s value). Let’s assume a conservative margin of 10%. If the oil futures price on February 3, 2025, was, say, $70 per barrel, one contract (1,000 barrels) would have a notional value of $70,000, and the margin required would be $7,000. With $10,000, you could afford to buy roughly 1 contract, with some cash left over.
2. Price Change: We need the price of oil futures on February 3, 2025, and today, April 7, 2025. While exact prices for those dates aren’t in my data, broader trends suggest oil prices have declined in 2025. For example, Brent crude oil reportedly decreased by 14.94% ($11.15 per barrel) from the start of 2025 to early April, and WTI crude oil dropped by 13.13% ($9.42 per barrel) over a similar period. If we assume WTI futures were around $70 per barrel on February 3 (a plausible mid-range value based on early 2025 benchmarks), a 13% drop would bring the price to approximately $60.90 by April 7.
3. Profit/Loss Calculation: If you bought 1 contract at $70 per barrel (total value $70,000) and the price fell to $60.90 per barrel (total value $60,900), your loss would be:
   • $70 – $60.90 = $9.10 per barrel
   • $9.10 × 1,000 barrels = $9,100 loss Since your initial investment was $10,000 (covering the margin), a $9,100 loss means you’d be left with $900 of your original capital, assuming no additional margin calls or fees.
4. Adjustments: If prices dropped more sharply (e.g., to $60 or lower, as some sources suggest WTI hit $61.99 on April 4), your loss could approach or exceed $10,000, potentially wiping out your investment and triggering a margin call. Conversely, if the drop was less severe, your loss would be smaller.

Estimated Answer:

Based on the trend of a 13% decline in WTI prices from early 2025 to now, and assuming a starting price of $70 per barrel on February 3, you would have lost approximately $9,100 on a $10,000 investment in one WTI futures contract by April 7, 2025. This is a rough estimate, as exact daily prices and your specific contract (e.g., May 2025 delivery) would refine the figure. Transaction costs, maintenance margin requirements, and market volatility could also affect the outcome.

For a precise calculation, you’d need the exact futures price on February 3, 2025, for the contract you chose, and the closing price on April 7, 2025, adjusted for any rollover costs if the contract expired. If you have those specifics, I can refine the answer further!