Topic: How does the commodity market work and how are gas prices determined? (Read 59 times)

While I understand that it's a pretty complicated and technical subject, in which many of us can't provide answers, however, I'd appreciate if it was possible to receive some feedback from the community. Especially now, that it's a relevant subject during this dire situation.

According to Investopedia, "the commodity market involves buying, selling, or trading a raw product, such as oil, gold, or coffee, while there are hard commodities, which are generally natural resources (such as gold, oil, rubber), and soft commodities, which are livestock or agricultural goods (such as wheat, corn, coffee)".

After we briefly analyzed what the commodity market is, I'd like to ask a few questions, some of which might be dumb, how exactly does the commodity market work? What's the difference between WTI Crude and Brent Crude? Despite the obvious, of Brent being the UK index, and WTI the US, how does one interfere with each other, and does WTI affect the European market of oil prices?

For instance, let's take WTI Crude, as seen on the following photo, currently priced at $95~, inside the parenthesis, it says "April Contract". What exactly is that, and how does it impact us? Moreover, what exactly is a "Future"?



And one last question, which possibly doesn't apply worldwide, because it's something that I've personally noticed myself, when the Russian invasion started on Ukraine, oil prices skyrocketed within a few days. We'd see new prices at gas stations on a daily basis, however, now that Crude oil has lost over $30 in value, and is close to pre-invasion levels, gas prices haven't significantly decreased. Is it purely speculative, or is there a deeper underlying reason?