Course dates
Physical trades comprise a substantial market position. However, paper trades have evolved rapidly over the past two decades and are designed to mitigate price risks and take advantage of opportunities.
The course has appeal to attendees from both technical and non-technical disciplines. Processes and terms are presented in clear and jargon-free language enabling attendees to rapidly grasp the fundamentals of crude oil characteristics and valuation. Attention is given to commercial value analysis and external market influences and price drivers.
Case studies and short exercises are included to consolidate learning outcomes.
Topics covered:
- Global crude oil supply and demand
- Major drivers of price; short-term and long-term
- Understanding the Markets
- Contrasting Physical and Paper Markets
- The Major Trading Centres and Commodity Exchanges
- Distinct Characteristics of Crude Oil
- Key Contract Features
- Terminology Used in Contracts
- Price Behaviour and Forecasting
- Refining manufacturing processes; cost, prices and margins
- Refinery economics and key performance indicators; margin, utilisation, product worth and crack spread
- Transportation; Marine and pipeline transportation logistics and illustrative costs
Who should attend?
- Lawyers
- Entry level traders
- Investment Bankers
- Fund Managers
- NOC and IOC Marketing teams
- Finance and Administrative Personnel
- Government Agencies
Course Overview
The course covers the valuation and pricing of physical deliveries of crude oil, as well as the derivative (paper) markets used in forward and futures market transactions. Understanding the trading markets is complicated by the use of technical and commercial jargon and acronyms.
This course is designed to clarify and demystify both technical and commercial aspects. You will gain an insight into the functions of the markets and the dynamics that shape crude oil markets in jargon-free language.
Crude oil transactions and contracts are explained and reviewed through the use of PowerPoint presentations and general discussions.
The key contractual terms in both physical and paper contracts are reviewed and explained and will enable you to appreciate the key drivers that are prevalent in the markets
Case study reviews and short exercises serve to consolidate learning outcomes
Benefits of attending:
- Acquiring a greater understanding of pricing and valuation in crude oil markets, and
- Recognise the use contracts to mitigate risks and offer opportunities
Day 1
Overview
- Geographical Distribution of Crude Oil Reserves and Production
- Key area of production and consumption
- Major tradeflows
- Current trends in the crude oil trading markets
- Future crude oil markets; availability long-term price trends and 'Peak Oil' considerations
Crude Oil Characteristics
- Physical and chemical properties; gravity, sulfur content
- Short and long-term price-drivers
- Crude oil classification and trading benchmarks
The Refining process
- Pre-treatment; crude de-salting and removal of other
- impurities
- The crude distillation unit and fractionation, vacuum
- distillation
- Typical product yields from various crudes
- Refinery configurations to optimise product yield
- Reforming, cracking, coking and deep conversion
- Hydrotreating and desulfurisation
Refinery Economics
- Gross and net refining margins
- Inputs; fixed and variable costs, crude prices
- Refinery key performance indicators
- Margins, crack spreads and gross product worth
Exercise: Delegates calculate gross product worth for an array of crude oils with supplied refined product prices
Refinery Management Challenges and Trends
- Matching yield to product market demand
- Supply logistics and storage considerations
- Linear planning
Day 2
The Crude Oil Trading Markets
- The history and evolution of today's trading markets
- Physical and derivative trading markets
- Term and spot contracts
- Spot prices and their importance in the price formation in physical and derivative contracts
The Crude Oil Sales Contract
- Key terms and conditions
- INCOTERMS
- Case study examples
The Crude Oil Transportation
- Marine tankers and WORLDSCALE rates
- Pipeline transportation and tariffs
- Storage and inventory
- Price netbacks
Exercise: Delegates develop a solution for the transport options for Middle East crude oil purchases for a U.S. gulf coast refinery
The Derivative Markets
- Forwards, futures, swaps and options
- Case studies; hedging programmes designed to mitigate future price risk
The Forward Price curve
- Backwardation and contango
- Case studies from 1990s and the 2000s
Day 3
Global Crude oil Benchmarks
- Brent, WTI, Urals, Dubai, Tapis etc.
- Interrelationships; premiums and differentials
- Benchmark spot prices and price-setting
- Aribtrage
Trading Characteristics
- Price volatility
- Refinery demand: the light/heavy differential
- Seasonal trends: "driving seasons, "heating seasons"
Price Reporting
- Platts and Argus
- Importance of validity of price analysis
Key Commodity Exchanges
- NYMEX, ICE, SMX, DME
- The players; Intermediaries, Banks, Traders, Brokers, Hedgers and Speculators
- Future Price Trends
Exercise: Delegates write forward contracts forsettlement in December 2012
Legislation
- United States
- CTFC- Dodd-Frank Act
- EU
- ACER, EMSA
Wrap-up and Takeaways
- Summary and key messages
- Discussion
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The course instructor has over 37 years of experience in the international oil and gas business. He has had experience of sales agreements dating back to the early 1970s with ‘life-of-field’ gas sales contracts to the U.K.’s then monopoly gas utility; BGC.
For over 26 years he worked for North American oil companies including ARCO, Marathon and Talisman on operations in Europe, Africa and the Middle East.
Since late 1998 he has been an independent oil and gas consultant. Assignments have included projects with a wide range of clients involved in the oil industry. Latterly, he has been involved in sales agreements covering crude, natural gas and refined product sales on behalf of oil company clients.
In 2009 he was a key consultant on a European Commission study into the competitive aspects of crude oil and product markets in the EU-27 member states.
He is also actively involved in delivering training and development programmes to delegates actively involved within the oil industry. He is a fellow of the Energy Institute, London.
Courses run by this instructor
Central London Hotel (energy), London, UK
All Euromoney Energy Training courses are held at four or five star venues in Central London, Zone 1. We strive to provide you with a training environment of the highest quality, to ensure that the whole learning experience exceeds your expectations.
Your training venue will be confirmed by one of our course administrators approximately 3-4 weeks before the course start date.
Interested in holding this course in-house? Please fill out your details and a member of our team will be in touch with more information.
25-28 Jun 2013 (London, UK)
10-13 Dec 2013 (London, UK)
17-20 Jun 2014 (London, UK)
This Euromoney Energy Training course examines markets, pricing and products to provide you with a thorough overview of the sector. The course will explore mechanisms and tools for both physical and financial oil trading allowing unparalleled access to the world of trading, its role within the oil industry and its importance in the success of oil companies. You will leave this course with a thorough understanding of the workings of crude oil markets and the range of contracts, tools and techniques available to traders.
16-19 Dec 2013 (London, UK)
This Petroleum Company Performance Management training course has been designed to offer personnel from corporations and financial institutions a full complement of tools to use most effectively in developing and analysing the corporate performance measures for oil and gas companies.
16-19 Sep 2013 (London, UK)
7-10 Apr 2014 (London, UK)
15-18 Sep 2014 (London, UK)
The Commercial and Trading Aspects of Oil Refining course will provide you with in-depth knowledge of the refining business and an understanding of how trading/hedging can improve margins and reduce risk. Discover how to optimise refinery margins and manage the profitability of commercial refining.
19-23 Aug 2013 (London, UK)
11-15 Aug 2014 (London, UK)
This Euromoney Energy Training course provides a comprehensive overview of the oil and gas industry from upstream exploration and production to downstream refining, sales and marketing. You will gain an appreciation of industry dynamics and the key issues affecting its development and future. This course will provide a thorough foundation for understanding the changing industry dynamics.
7-9 May 2014 (London, UK)
This course will investigate the mechanisms for trading physical oil, freight, shipping and derivatives to optimise margins and achieve profit targets. The interdependence between oil markets and ship chartering will be extensively explored, revealing links to the derivative markets and the use of trading tools.
16-18 Oct 2013 (London, UK)
12-14 Feb 2014 (London, UK)
15-17 Oct 2014 (London, UK)
This Euromoney Energy Training course provides a comprehensive overview of the oil and gas industry from upstream exploration and production to downstream refining, sales and marketing. Under the guidance of our expert course faculty, participants will gain an appreciation of industry dynamics and the key issues affecting its development and future.
26-29 Aug 2013 (New York, United States)
This 4 day International Oil & Gas Contracts course is specifically designed for professionals involved internationally in the oil and gas industry, it offers a unique opportunity to rapidly increase your understanding of the legal issues involved in various UK and international scenarios and to improve your techniques and skills in drafting a variety of international contracts.
2-4 Dec 2013 (London, UK)
14-16 May 2014 (London, UK)
3-5 Dec 2014 (London, UK)
Euromoney Energy Trainings Petroleum Sales Contracts course is designed to give attendees a comprehensive understanding of crude oil, natural gas and refined products markets and the sales contracts that are utilised for transactions through the supply chain.
19-20 Aug 2013 (Singapore)
This Traded Electricity Markets course is a comprehensive and systematic introduction to traded electricity markets. The course will detail why and how electricity – the most challenging of all commodities – presents complexities more acute than in other traded market sectors, and how to understand, model and manage these demanding conditions. Case studies will illustrate how companies have resolved these issues, including Centrica, one of very few companies to have made a successful entry into this most difficult of markets.
3-4 Jun 2013 (London, UK)
9-10 Dec 2013 (London, UK)
This Traded Electricity Markets course is a comprehensive and systematic introduction to traded electricity markets. The course will detail why and how electricity – the most challenging of all commodities – presents complexities more acute than in other traded market sectors, and how to understand, model and manage these demanding conditions. Case studies will illustrate how companies have resolved these issues, including Centrica, one of very few companies to have made a successful entry into this most difficult of markets.
13-15 Nov 2013 (Singapore)
24-28 Jun 2013 (London, UK)
Featuring 3–individually bookable modules:
- Upstream development & production
- Mid-stream pipelines & LNG projects
- Downstream oil refineries & petrochemical plants
- Including: 16 key industry case studies to improve your understanding
28 Oct 2013 - 6 Nov 2013 (Hong Kong)
This course will enable participants with skills to identify and analyse prospective borrowers, structure credit facilities, and prepare credit applications for formal presentation and approval by bank credit committees. These skills can be used by the origination teams and credit teams of lenders and to support organisations which run or sponsor projects.
16-20 Sep 2013 (London, UK)
This 5-day course is designed to introduce both lawyers and nonlawyers alike to the theories and practice of international commercial and investment arbitration in the oil & gas industry.
9-12 Dec 2013 (London, UK)
This four day training course is specifically designed for professionals involved internationally in the oil and gas industry, it offers a unique opportunity to rapidly increase your understanding of the legal issues involved in various
international scenarios and to improve your techniques and skills in drafting, reviewing, and executing a variety of
international contracts.
2-5 Dec 2013 (London, UK)
This 4-day course will equip delegates with a critical understanding of why and how the law with respect to upstream and downstream oil and gas operations is rapidly changing, in view of the increasing importance of environmental and sustainable development issues.
15-17 Jul 2013 (London, UK)
This 3-day course is designed to introduce both lawyers and nonlawyers alike to the understanding of how to arrange and manage EPC contracts and how to avoid and manage disputes.
15-18 Jul 2013 (London, UK)
4-7 Nov 2013 (London, UK)
7-10 Jul 2014 (London, UK)
3-6 Nov 2014 (London, UK)
4 days of course modules that focus on the review and examination of the key elements of the supply chain from upstream activities of exploration, development and production through transportation to downstream sector that involves trading, refining, petrochemicals and final distribution to the consuming markets.
11-13 Nov 2013 (Doha, Qatar)
This 3-day course is designed to introduce both lawyers and nonlawyers alike to the understanding of how to arrange and manage EPC contracts and how to avoid and manage disputes.
25-26 Nov 2013 (Kuala Lumpur, Malaysia)
This 2-day course is designed to introduce both lawyers and non-lawyers alike to the understanding of how Procurement Strategy for the Oil & Gas Industry actually works. This course is delivered by combining a substantive legal understanding together with a practitioner's perspective.
17-20 Jun 2013 (London, UK)
This 4 day International Oil & Gas Contracts course is specifically designed for professionals involved internationally in the oil and gas industry, it offers a unique opportunity to rapidly increase your understanding of the legal issues involved in various UK and international scenarios and to improve your techniques and skills in drafting a variety of international contracts.
9-12 Sep 2013 (Singapore)
This 4-day course is designed to introduce both lawyers and non-lawyers alike to the understanding of how Procurement Strategy for the Oil & Gas Industry actually works. This course is delivered by combining a substantive legal understanding together with a practitioner's perspective.
Objectives
The objectives of the conference will be to
provide a practical understanding
• Provide an understanding of the tendering and contracting process
• Provide an understanding of techniques to avoid collusion or corruption during the tendering process
• Develop an understanding of ways to select bidders
• Show how to develop Invitations to Tender, and how to manage the tendering process
• Understand and manage the negotiation process
•
Who should attend
• Tender or Bidding Managers
• Contract Administrators
• Contracting Unit Supervisors
• Project Engineers and Project Managers
• Business Audit Officers
• Contract Strategists
• General Managers involved in developing contracts or contract negotiation
21-24 Dec 2013 (Riyadh, Saudi Arabia)
This 4 day International Oil & Gas Contracts course is specifically designed for professionals involved internationally in the oil and gas industry, it offers a unique opportunity to rapidly increase your understanding of the legal issues involved in various UK and international scenarios and to improve your techniques and skills in drafting a variety of international contracts.
3-5 Jun 2013 (London, UK)
This course will give you an in-depth introduction to petroleum refining technology and economics. The focus is on transportation fuels refineries, however, petrochemical production and biofuels are also discussed. The first part of the program includes an
overview of crude oil supply and petroleum product demand. This is followed with a description of refinery process technology. Key refining technologies are described such as crude oil distillation, heavy oil conversion options, hydrotreating, and catalytic reforming.
16-18 Sep 2013 (London, UK)
18-20 Nov 2013 (Singapore)
This course will give you an in-depth introduction to petroleum refining technology and economics. The focus is on transportation fuels refineries, however, petrochemical production and biofuels are also discussed. The first part of the program includes an
overview of crude oil supply and petroleum product demand. This is followed with a description of refinery process technology. Key refining technologies are described such as crude oil distillation, heavy oil conversion options, hydrotreating, and catalytic reforming.
3-5 Jun 2013 (New York, United States)
This Petroleum Company Performance Management training course has been designed to offer personnel from corporations and financial institutions a full complement of tools to use most effectively in developing and analysing the corporate performance measures for oil and gas companies.
9-13 Dec 2013 (Istanbul, Turkey)
Course dates