What Is Oil And Gas Trading
Did you know that the largest producer and market for oil is the United States of America. According to CMC Markets, the superpower produces close to 17.87 million barrels of oil which translates to about 18% of all the oil created in the world. Other countries which produce vast amounts of oil include other world superpowers such as China and Russia.
However, one fundamental aspect that should be discussed is the process of oil and gas trading. LexisNexis introduced the concept of oil and gas trading as an allowance provided by national governments to various companies so that they can search for precious natural resources. After which, these companies have the green light to produce oil and natural gas.
CMC Markets also posit that crude oil trading can be done through investments or through the purchase and selling of crude oil. Another method can be done through speculating on the price of crude oil with its ebb and flow.
Our team at Winson Oil, have addressed the two common methods in which oil and gas is often traded.
1. Investments in Oil
The first method is known as Exchange-Traded Funds (ETF) trading. Within this method, investors have ownership of assets like the shares in oil companies. This means that when the price of oil changes, whether it be for better or worse, it can impact the shares and overall value of the ETF, as per CMC Markets.
Furthermore, nerdwallet.com explains that these investors who have an ownership of these key assets can then sell these shares to other interested parties. One highlight of ETF trading is that the ETF value moves in accord with the ever changing price of oil.
2. Oil Futures Trading
Another popular method of bartering oil in the market is through oil futures trading. These are essentially agreements that are drawn up and they determine the date on which the oil will be bought or sold.
Investopedia posits that in oil futures tradings and contracts the buyers and sellers can fix a certain price that oil will trade at in the future! Furthermore, traders tend to speculate on prices for oil by closely considering the supply and demand from the market along with the overall market trajectory.
More About Winson Oil
Founded in 1970 by Wilson Rodrigues, Winson Oil has established itself as one of Asia’s major energy trading companies. We have offices in various parts of the Asiatic continent including Hong Kong, the Philippines, and Bangalore.
Winson Oil is focused on guaranteeing customer satisfaction. With due diligence and strict compliance to the trading partner’s specifications, we focus on building relationships with partners and ensuring that their efforts and contributions are recognized.
With over 50 years of experience under our belt, we are always trying to understand the work of our partners better so that we can offer end-to-end supply chain solutions. These include onshore and offshore oil tanks, shipping service distribution, vessels, and essential logistics.
With a strong partner network, a fortified position in the market and a deep sense of customer needs, we are zealous in offering the best services and solutions to our clients. We are proud to continue to provide integral solutions to our clients and hope to spread our reach to other regions. In fact, we have plans to open offices in countries like Australia and New Zealand.