Summary of Content by Chapter
- An overview of who gets involved in products trading and why. It looks at the roles of producers, refiners and traders and all the other participants, such as storage companies, blenders, tanker owners, pipeline operators, and rail and road truck suppliers, that get involved in the supply chain from the wellhead to the point of distribution to end-users.
- Delves into the refining processes involved in separation, treatment and upgrading of oil products. It provides the basic carbon chemistry needed to fully appreciate the refining industry and the changes wrought by the various processes such as vacuum distillation, hydrotreating, reforming or cracking.
- Takes a long, hard look at each of the key burnt products, categorised by petroleum gases, light distillates, middle distillates and fuel oil, and the speciality products such as lubes, bitumen and coke. It considers the use to which each is put, their key quality specifications, and the way these products are measured, sampled and tested to meet those specifications.
- Analyses oil product transport and storage logistics and delivery terms. It looks at the standardisation of physical product contract terms and custom and practice for arranging documentation, credit and payment in the oil industry.
- Uses the Consilience “A+/-T+/-G” technique of analysing commodity prices. “A” represents the absolute price of a benchmark grade, “T” is the time differential between the delivery date of the benchmark grade and the delivery date of the oil product in question, and “G” is the difference between the quality of the benchmark grade and the quality of the oil being delivered.
- Gets to grips with risk management and hedging. It explains forward contracts, futures, swaps and options in easy steps with plenty of worked examples to lead the reader to a profound understanding of what can and cannot be achieved with the existing market instruments.