International Oil Supply, Transportation, Refining and Trading
Course Summary
This course provides an overview of the oil supply chain from upstream economics, transporting crude oil from source to the refinery through processing, trading and the retailing of oil products. It is designed for new entrants to the oil industry. This course is ideal for use as part of an induction programme or for bringing those transferring disciplines up to speed with the area. Those without prior knowledge of the oil industry may wish to familiarise themselves through our "Introduction to the Oil Industry" course. Through the medium of continuous case study, delegates will address day-to-day problems in order to understand the relevant commercial driving forces in this area.
After learning the fundamentals, delegates will cover the valuation of crude oil. Ocean tanker transport and freight will be explored together with a basic overview of terminals and pipelines. The structure of a refinery will be explained in the context of the need to produce marketable products. Key aspects of product quality will be covered together with the major refining processes needed to achieve them. The refining interface with petrochemicals, and retail/distribution will also be covered. The course moves on to cover oil markets and pricing and an introductory guide to paper markets and simple hedging.
32.5 Continuing Professional Development (CPD) credits awarded for this course. Authorised byThe Law Society of England and Wales .
What You Will Learn
- Fundamental analysis
- Supply relationship with upstream
- How to value of crude oil based on product market prices
- How to evaluate spot tanker freight costs
- How tankers are chartered
- How oil and tanker contracts are structured
- How to evaluate netbacks
- How a refinery is structured
- The refinery petrochemical interface
- The interface with retail, industrial and transportation markets
- The key points on product quality
- How key specifications are met
- Fundamental economic drivers of the downstream
- How the international oil markets are priced
- The basic use of hedging within a trading environment
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Suitability:
- New entrants to the oil industry, and integrated sections as supply, trading and logistics
- Managers changing disciplines into the downstream
- Professional personnel inside and outside oil companies interfacing with supply, refining, trading and transportation functions and who need an overview of this sector such as legal, banking, insurance, finance and production
Course content:
Fundamentals
- Supply/demand/refining balance
- Impact of OPEC
- IEA
- Environmental issues affecting the balance
- The place of oil relative to other energy sources
Upstream
- Interface with supply
- Ne- Technology
- Field organization
Crude Oil
- Types
- Assay
- Yield
- Crude value
- Calculation of gross product worth and netback
The Refinery
- Structure of simple, upgrading and complex refineries
- Refinery margins
- Refining costs
- Processing deals
Product Quality
- Key specifications for main grades
- Ho- quality specifications are achieved
- Cost implications of quality
- Primary logistics
- Tanker freight costing, Worldscale
- Chartering
- Pipelines, terminals
- Losses
Lubricants and Petrochemicals
- Feedstock interface with refinery
- Interface with oil markets
The Domestic Markets
- The Interface with Secondary Logistics
- Retail and service stations
- Exchange and terminalling agreements
- Industrial, aviation and bunker markets
- Competitive pressures, the independent vs. major
- Corporate profitability and the recovery of supply costs increases
Contracts
- Oil contract terms
- Tanker contract (charterparty)
Oil Markets
- Location and nature of pricing
- Crude oil
- Products
- Forward markets
- Futures markets
- Derivatives
- Use of hedging
- Use of technical analysis
Exercises and Case Studies will include:
- Gross product worth
- Freight
- Netback
- Contracts
- Quality
- Refining margin and processing
- Total barrel economics
- Hedging
