When you are investing in oil, you are faced with a high financial barrier. The volatility of the oil industry makes it difficult for the average investor to take the risk. However, if you have the time and money to invest, it could be a lucrative option. In addition to gaining a passive income tax break, you can invest in royalty interests or exploration companies. These types of investments are not suitable for beginners because they can lead to massive losses or huge rewards. While it may be tempting to purchase a stock that has a good track record, you need to be wary of false promises about investment returns. While investing involves risks, there are no guarantees. Always do your research and know who you are dealing with. Furthermore, the oil market is very volatile, so it is crucial to understand how price influences your investments. Below, we will look at four factors that influence oil prices. When you invest in oil, you should also be aware of the risks involved. o The oil market is highly volatile, but if you are willing to take the risk, it is possible to gain a large profit. Although there is a risk of losing money, the returns are worthwhile in the long run. As with any investment, you should invest only what you can afford to lose. Whether you choose to invest in stocks or exchange-traded funds, investing in oil is a profitable way to diversify your portfolio.