Some specific features of contract work in crude oil trading

Andrej Moiseevich Golubchik and Pavel Borisovich Katykha
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Andrej Moiseevich Golubchik: Russian Foreign Trade Academy, Moscow, Russia
Pavel Borisovich Katykha: Gubkin Russian State University of Oil and Gas (National Research University), Moscow, Russia

Russian Foreign Economic Journal, 2016, issue 6, 18-28

Abstract: Trading in crude oil and petroleum products (oil trading) has a number of specific features that distinguish very seriously this kind of business from other foreign trade operations. Oil trader works in a fast-changing spot market, almost any contract value exceeds $ 1.5-2 million. Besides,it is necessary to remember that the extraction of oil is always accounted for in units of volume(barrels), traded both in barrels and in tonnes, but it is transported only in tonnes, which under certain circumstances can generate serious risks. This article describes four components of the foreign trade contract work that have acquired specific content in oil trading: description of product and its quality, delivery conditions, conclusion and execution of the vessel chartering contract,methods of payment for goods.

Keywords: Crude oil trading; INCOTERMS; crude oil cargoes; petroleum products; foreign trade contract; letter of credit; charter party; charter bill of loading. (search for similar items in EconPapers)
Date: 2016
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