1 / 76

Crude Oil Market Evolution and Pricing: A Comprehensive Analysis

Explore the dynamics of global oil markets, pricing mechanisms, refining processes, and petroleum trade. Gain insights into crude oil markers, pricing fluctuations, refining margins, and refining capacity. Understand the impact of petroleum stocks on prices and the role of OPEC in stabilizing oil markets. Stay informed about crude oil value, trade paths, and refined product applications. Enhance your knowledge of key concepts in the petroleum industry with this detailed analysis.

lsabatino
Download Presentation

Crude Oil Market Evolution and Pricing: A Comprehensive Analysis

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Refinery Planning & Economics

  2. Topics 1- Oil Markets 2- Crude Oil Pricing 3- Refining 4- Refined Products Prices (Asia/AG) 5- LPG 6- Shipping

  3. Oil Markets • Crude Oil Markers (Benchmarks) • World Refining Centers • Oil Movement & Trade Paths • Petroleum Trade Markets • Petroleum Stocks

  4. Crude Oil Markers The Three Main Crude Oil Markers are: • West Texas Intermediate - America • Brent - Europe & Africa • Dubai - Asia/Pacific

  5. Crude Oil Prices

  6. Contango & Backwardation

  7. NWE MED US ASIA WORLD REFINING CENTERS

  8. BRENT WTI DUBAI OIL MOVEMENT & TRADE PATHS

  9. Arbitrage • The Trade Between Geographical Areas to Earn Profit • The Arbitrage is Open When the Price in the Loading Port Plus Freight is Less Than the Price at the Discharge Port

  10. Arbitrage Demand

  11. $21/MT $14/MT $14 /MT $30 /MT Naphtha Arbitrage (Japan/MED) $228/MT $177/MT $200/MT “THE ARB IS OPEN” MAR ‘97

  12. – $5/MT $7/MT $13 /MT $29 /MT Naphtha Arbitrage (Japan/MED) $200/MT $177/MT $176/MT $180/MT “THE ARB IS CLOSE” SEP ‘97

  13. Saudi Aramco International Crude Oil Storage

  14. Petroleum Stocks Reports American Petroleum Institute (API) • Weekly Report Covering the US Energy Information Agency (EIA/DOE) • Weekly Report Covering the US - Official International Energy Agency (IEA) • Monthly Report Covering OECD

  15. API Report August 6, 1999

  16. Stocks’ Impact On Prices $/BBL 1,000 BBL 18 400,000 16 14 350,000 12 10 300,000 8 6 250,000 4 2 0 200,000 5-Oct 7-Sep 3-Aug 27-Jul 14-Sep 21-Sep 28-Sep 12-Oct 19-Oct 26-Oct 10-Aug 17-Aug 24-Aug 31-Aug US Total Crude Stocks (API) WTI Cushing Mth1

  17. Topics 1- Oil Markets 2- Crude Oil Market 3- Refining 4- Refined Products Prices (Asia/AG) 5- LPG 6- Shipping

  18. Crude Oil Market • Evolution of Crude Oil Pricing • Crude Oil Value • Petroleum Oil Price Reporting • Crude Oil Contracts • Crude Oil Supply & Demand

  19. Evolution of Crude Pricing • Posted Price: • Set by Governments of Producing Countries • Price Changes Infrequently & Varies by Producer • Netback Price: • Based on Product Prices Less Refining Fee • Guaranteed Refiners a Positive Margin • Market-Related Price: • Related to Published Quotation of a Marker Crude • Differentials Applied are Standard • Refining Margins are not Protected

  20. Crude Oil Value Crude Oil Value is Related to the Value of the Refined Products • API • Sulfur Content Other Factors • Refinery Type (Configuration) • Paraffinic/Naphthenic

  21. Oil Price Reporting • Who Report Oil Prices? • Platt’s • Petroleum Argus • London Oil Reports (ICIS-LOR)

  22. Oil Price Reporting • How are Oil Prices Published? • Published Quotations Represent Fixed-Price Spot Transactions, Confirmed Bids & Offers and Market Talk. • Price Reporting Agencies have Different Bases for Trade Reporting, Freight Assessment and Freight Calculation

  23. Platt’s Crude Oil Marketwire Report

  24. Platt’s Crude Oil Marketwire Report

  25. Contracts • Contract Types: • Term • Spot • Sales Types: • FOB Free On Board • CIF Cargo, Insurance & Freight • C&F Cargo & Freight • Others Lightering, ex-ship, ex-storage, …

  26. Saudi Arabia Production: 8.3 MBD Consumption: 1.8 MBD Export: 6.5 MBD Far East: 48% Europe: 25% US 22% Others 5% 2000 Data

  27. Saudi Arabia's 5-Year Crude Production Plan

  28. Saudi Arabia's 5-Year Crude Production Plan (by Grade)

  29. Top 10 Oil Production -2002 TOTAL WORLD: 73.94 Million BBL/Day

  30. Oil Production -2002

  31. Oil Production -2002

  32. Top 10 Oil Consumption -2002

  33. Oil Consumption - 2002

  34. World Total Oil Consumption

  35. Global Supply/Demand Balance

  36. Proven Oil Reserve by country 2002

  37. Proven Oil Reserve by region

  38. Reserve/Production Ratio 2002

  39. Organization of the Petroleum Exporting Countries (OPEC) • Founded in Baghdad in 1960 • Objective: To Coordinate and Unify Policies Among the Members in Order to Secure Fair and Stable Prices for Petroleum Producers OPEC COUNTRIES: IRAN, IRAQ, KUWAIT, SAUDI ARABIA, VENEZUELA, QATAR, INDONESIA, LIBYA, UAE, ALGERIA, & NIGERIA

  40. OPEC PRODUCTION LEVEL

  41. TOPICS 1- Oil Markets 2- Crude Oil Pricing 3- Refining 4- Refined Products Prices (Asia/AG) 5- LPG 6- Shipping

  42. REFINING • Refined Products Supply/Demand • World Refining Capacity • Refined Products Applications • Refined Products Specifications • Regional Quality Variations Refined Products supply/demand figures are based on Purvin & Gertz report (March 2001 update) World refining capacity date are based on BPAmoco Statistical Review - 1999

  43. World Supply & DemandRefined Products Deficit Surplus Thousand BBL/Day

  44. World Supply & DemandRefined Products by Region Net Importer Net Exporter Thousand BBL/Day

  45. World Refining Capacity

  46. Refined Products Applications • Propane: Petrochemical Industry/Home • Butane: Petrochemical/Home/Gasoline • Naphtha: Petrochemical/Gasoline • Jet: Jet Fuel/Domestic Appliances • Gasoil: Automotive Fuel/Heating Oil • Fuel Oil: Bunker/Power/Industrial Boilers

  47. Products Specifications • Naphtha • Naphthenic / Paraffinic • Gasoline • Octane Number (RON/MON) • Sulfur Content / Olefins Content • Gasoil • Sulfur Content • Cetane Number • Fuel Oil • Sulfur Content • Viscosity • Straight-Run vs. Cracked

  48. Regional Quality Variations • End Use Requirement • Climate Conditions • Refinery Technology • Environmental Issues • Environmental Issues

  49. Regional Quality Variations • Gasoline • Lead-Free • MTBE Concern • Benzene Content • Volatility • Diesel • 0.05% Sulfur • Fuel Oil • 1.0% Sulfur NORTH AMERICA

  50. Regional Quality Variations • Gasoline • Lead-Free • Benzene Content • Following the US • Diesel • 0.05% Sulfur • Fuel Oil • 1.0% Sulfur WESTERN EUROPE

More Related