Crude oil futures investment guide


The oil crisis in the early 1970s has brought great impact to the world oil market. The sharp fluctuation of oil price directly leads to the emergence of oil futures. Since the birth of oil futures, its trading volume has been showing a rapid growth trend, which has surpassed metal futures, and is an important part of the international futures market.

Among the oil futures contracts, crude oil futures is the largest trading volume. At present, there are three kinds of crude oil futures contracts with the largest trading volume and the most extensive influence in the world: WTI (West Texas Intermediate crude oil) futures contract of New York commercial exchange (NYMEX), Brent (North Sea Brent crude oil) futures contract of London International Petroleum Exchange (ice), and Dubai (Dubai crude oil) futures contract of Singapore International Financial Exchange (SIMEX).

Other product oil futures include distillate oil, unleaded gasoline, gas oil, heating oil, fuel oil, light diesel oil, etc.

International crude oil trading mainly adopts the pricing method of base price + / - discount. Futures trading prices such as WTI, Brent and Dubai are often used as benchmark prices. Take CME's WTI futures contract as an example, its specification is 1000 barrels per hand, the unit of quotation is USD / barrel, and the minimum unit of price fluctuation is 1 cent. The crude oil produced in the Western Hemisphere is mainly priced by WTI, including the ans of the United States, Maya of Mexico, Oriente of Ecuador, SantaBarbara of Venezuela and Escalante of Argentina. Brent is mainly linked to crude oil produced in Western Europe, the Mediterranean and West Africa, such as Urals in Russia, sarir in Libya and bonnylt in Nigeria. Dubai is mainly affiliated with crude oil produced in the Middle East. However, the crude oil produced in the Far East is mainly linked to regional benchmark oils such as Minas, Cinta and duri.

According to the data of "oil and gas journal" of the United States, as of the end of 2007, the proven remaining recoverable oil reserves of the world were 182.424 billion tons, an increase of 1.1% over the same period of last year, and the reserve production ratio was 50.4 years. Saudi Arabia has the largest proven recoverable reserves in the world, reaching 36.541 billion tons, accounting for about 20% of the world. The reserve production ratio is 84 years. In 2007, the global crude oil production was 3.618 billion tons, and the top five oil producing countries were Russia, Saudi Arabia, the United States, Iran and China.

As of January 1, 2002, the estimated proven oil reserves in the world are 141.309 billion tons. Saudi Arabia has the largest oil reserves in the world. The global crude oil production in 2001 was 3.18 billion tons, and the top five countries were Russia, Saudi Arabia, the United States, China and Norway. Among them, the output of Russia and China increased by 9% and 1.8% respectively. Russia replaced Saudi Arabia as the world's largest oil producer from the second place in 2000, while China also rose to fourth place from fifth place last year. Oil is the "blood of industrial production" and an important strategic material. In order to safeguard their own interests, the world's oil producing countries established the organization of Petroleum Exporting Countries (OPEC) in September 1960. There are 13 member states: Iraq, Iran, Kuwait, Saudi Arabia, Venezuela, Algeria, Ecuador, Canada, Indonesia, Libya and Nigeria Qatar and the United Arab Emirates. Based in Vienna, the capital of Austria, OPEC's oil reserves have reached 113.3 billion tons, accounting for nearly 80% of the world's total reserves.

Was this article helpful?

0 out of 0 found this helpful