INTRODUCTION
TRADING
Initial margin 5%
Special margin In case of additional volatility, a special margin as deemed fit, will be imposed immediately on both the buy
and sell side in respect of all outstanding position, which will remain in force for next 2 days, after which the
special margin will be relaxed.
Maximum allowable open position For individual clients: 1,50,000 barrels. For a member collectively for all clients: 6,00,000 barrels or 20% of the
open market position, whichever is higher.
DELIVERY
QUALITY SPECIFICATIONS
Special margin In case of additional volatility, a special margin as deemed fit, will be
imposed immediately on both the buy and sell side in respect of all
outstanding position, which will remain in force for next 2 days, after
which the special margin will be relaxed.
Maximum allowable open For individual clients: 1,00,000 barrels; For a member collectively for all
position clients: 25% of the open market position.
DELIVERY
Middle east south sour crude oil either of Dubai or Oman origin with the following
specification:
Sulphur : 2.05% by weight or less
API Gravity: Between 31-37%
OPEC
• 'Organization of Petroleum Exporting
Countries‘was founded in 1960 in baghdad.
• It is an organization of eleven developing
countries that are heavily dependent on oil
revenues as their main source of income.
• The current Members are Algeria, Indonesia,
Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi
Arabia, the United Arab Emirates and
Venezuela.
• OPEC controls almost 40 percent of the world's crude
oil.
• It accounts for about 75 per cent of the world's proven
oil reserves.
• Its exports represent 55 per cent of the oil traded
internationally.
• The OPEC has identified China & India as their main
buyers of oil in Asia for several years to come.
CAUSES OF HIGH CRUDE OIL PRICES
• Shortage of oil supplies.
• Balance of demand and supply in short time.
• Rate of investment in the longer term.
• If traders in the oil market believe there will
be a shortage of oil supplies, they may raise
prices before a shortage occurs.
• War.
• Natural disasters.
CAUSES OF LOW CRUDE OIL PRICES.
• Imbalance between supply
and demand.
• If oil production rises faster
than demand.
• If the oil industry is
unprofitable and discourages
investors.
INDIAN SCENARIO
• India ranks among the top 10 largest oil-
consuming countries.
• Oil accounts for about 30 per cent of India's total
energy consumption.
• The country's total oil consumption is about 2.2
million barrels per day.
• India imports about 70 per cent of its total oil
consumption and it makes no exports.
• India faces a large supply deficit, as domestic oil
production is unlikely to keep pace with demand.
• India's rough production was only 0.8 million
barrels per day.
• The oil reserves of the country (about 5.4
billion barrels) are located primarily in
Mumbai High, Upper Assam, Cambay, Krishna-
Godavari and Cauvery basins.
• India had a total of 2.1 million barrels per day
in refining capacity.
• Government has permitted foreign
participation in oil exploration, an activity
restricted earlier to state owned entities.
• IOCL is the largest refinery co. in india.
• RPL’s jamnagar refinery is the largest in india
and third largest in world.
MCX CRUDE OIL FUTURES
• MCX was the first to start crude oil futures in
india in 2005.
• Crude oil accounts for 25 per cent of the
country’s import bill
• Volatility in crude oil prices affects the
economic scenario quite adversely.
• High oil prices lead to inflation, increased
input costs, reduced non-oil demand and
lower investment in net oil importing
countries
• Transporters and Airline companies can hedge
the risk of rising Diesel/Petrol prices by taking a
hedge in Crude Oil futures .
THANK YOU!!!