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72-402: The Brent Crude oil marker is also known as Brent Blend, London Brent and Brent petroleum. This grade is described as light because of its relatively low density, and sweet because of its low sulphur content. Brent is the leading global price benchmark for Atlantic basin crude oils. It is used to set the price of two-thirds of the world's internationally traded crude oil supplies . It is one of

144-647: A Jurassic sandstone / shale reservoir 1829 m deep in a " fault-bounded anticlinal trap", was discovered in 1976 with well 11/30-1, drilled by the Mesa Petroleum Group (named after T. Boone Pickens' wife Bea, "the only oil field in the North Sea named for a woman") in 49 m of water. Volatile weather conditions in Europe's North Sea have made drilling particularly hazardous, claiming many lives (see Oil platform ). The conditions also make extraction

216-510: A BFOET assessed crude price called Argus North Sea Dated crude price, and ICIS provides the final settlement data to the ICE Brent Index (which ultimately settles ICE Brent futures) since 2015. However, in the early 1990s, Brent and BFOET crude spot markets started to price transactions using assessed Dated Brent prices as benchmark prices, which created a feedback loop that diluted fundamental supply and demand information contained in

288-639: A Crude Diff or 'Dated to Front Line' (DFL) contract, which is a spread contract between Dated Brent and Brent 1st Line Future (the front month future), to hedge the basis risk. So a complete hedge would be the relevant Brent futures contract, and a DFL contract when the futures contract becomes the front month future. This is equivalent to a Brent forward contract and a CFD contract in forward contract terms. Historically, price differences between Brent and other index crudes have been based on physical differences in crude oil specifications and short-term variations in supply and demand. Prior to September 2010, there existed

360-526: A Dated Brent and Forward Month Brent Contracts-for-Difference market increased this vulnerability, and market participants gradually switched to using Dated Brent as the spot transaction reference price by 1988. Brent crude oil contract-for-difference (CFD) is a weekly spread or swap between the Dated Brent assessed price and the Second Month (or M2) Brent crude oil forward contract. They trade over

432-710: A combined total of around 1340 m³ (8,400 barrels) per day. Gas was found by chance in a water well near Hamburg in 1910, leading to minor gas discoveries in Zechstein dolomites elsewhere in Germany. In England, BP discovered gas in similar reservoirs in the Eskdale anticline in 1938, and in 1939 they found commercial oil in Carboniferous rocks at Eakring in Nottinghamshire . Discoveries elsewhere in

504-510: A costly process; by the 1980s, costs for developing new methods and technologies to make the process both efficient and safe far exceeded NASA 's budget to land a man on the moon. The exploration of the North Sea has continually pushed the edges of the technology of exploitation (in terms of what can be produced) and later the technologies of discovery and evaluation (2-D seismic, followed by 3-D and 4-D seismic ; sub-salt seismic; immersive display and analysis suites and supercomputing to handle

576-695: A depth of 3000 m subsea in a "westward tilted horst block". Offshore production, like that of the North Sea, became more economical after the 1973 oil crisis caused the world oil price to quadruple, followed by the 1979 oil crisis , which caused another tripling in the oil price. Oil production started from the Argyll & Duncan Oilfields (now the Ardmore) in June 1975 followed by Forties Oil Field in November of that year. The inner Moray Firth Beatrice Field,

648-910: A dry hole in May 1970, followed by the discovery of the giant Forties Oil Field in October 1970. The following year, Shell Expro discovered the giant Brent oilfield in the northern North Sea east of Shetland in Scotland and the Petronord Group discovered the Frigg gas field . The Piper oilfield was discovered in 1973 and the Statfjord Field and the Ninian Field in 1974, with the Ninian reservoir consisting of Middle Jurassic sandstones at

720-460: A five-day work week in volumes of 100 or 100,000 lots and the most recent CFD rolls to the next-week CFD on Thursday. The CFD market developed in 1988 in response to basis risk between the Brent futures/forward contract prices and the spot/dated Brent prices. In contrast to open forward contracts, Brent crude oil "dated" contracts – known as dated Brent contracts – specify the delivery date of crude in

792-718: A mix of crude oil from 15 different oil fields in the North Sea . It is the benchmark used primarily in Europe though it is also mixed in with the OPEC reference basket which is used around the world. Dubai Crude , also known as Fateh, is a heavy sour crude oil extracted from Dubai. It is produced in the Emirate of Dubai, part of the United Arab Emirates . Dubai's only refinery, at Jebel Ali, takes condensates as feedstocks, and therefore all of Dubai's crude production

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864-729: A notice of at least 15 days of intention to deliver. More recently, the notice period has expanded to 10 days to one month ahead. This shifted the front month of the Brent forward contract. For example, on May 4, the Front Month forward contract (also known as M1) is the July contract, the Second Month (M2) contract is the August contract, and the Third Month (M3) contract is the September contract. Producers and refiners buy and sell oil on

936-738: A potential new mechanism arose in the form of the Dubai Mercantile Exchange , which offers futures contracts in Omani crude. Whether the DME will be successful, and whether Omani futures prices will be adopted by producers and buyers as a benchmark, remain to be seen. Edmonton Par and Western Canadian Select (WCS) "are benchmarks [sic] crude oils for the Canadian market. Both Edmonton Par and WCS are high-quality low sulphur crude oils with API gravity levels of around 40°. In contrast, WCS

1008-446: A reference price originally set by BNOC and eventually calculated as a 30-day price average of spot prices before an oil transaction. Forward market prices tended to be lower than these reference prices a lot of the times, and integrated oil producers could profitably lower their tax obligations by selling oil on the forward market from their production operations, and buying back oil from unrelated parties for their refining operations on

1080-476: A similar period energy from gas imports have risen by a factor of approximately 10, from 60GWh in 2001 to just over 500GWh in 2019. UK oil production has seen two peaks, in the mid-1980s and the late 1990s, with a decline to around 300×10 m³ (1.9 million barrels) per day in the early 1990s. Monthly oil production peaked at 13.5×10 m³ (84.9 million barrels) in January 1985 although the highest annual production

1152-674: A typical price difference per barrel of between ±3 USD/bbl compared to WTI and OPEC Basket; however, since the autumn of 2010 Brent has been priced much higher than WTI, reaching a difference of more than $ 11 a barrel by the end of February 2011 (WTI: US$ 104/bbl, LCO: US$ 116/bbl). In February 2011 the divergence reached $ 16 during a supply glut, record stockpiles, at Cushing, Oklahoma before peaking at above $ 23 in August 2012. It has since (September 2012) decreased significantly to around $ 18 after refinery maintenance settled down and supply issues eased slightly. Many reasons have been given for this divergence ranging from regional demand variations, to

1224-494: Is 1.4 mbpd. This is a more than 50% decline since the peak in 2001 of 3.2 mbpd. The geological disposition of the UK's oil and gas fields is outlined in the following table. Kittiwake, Gannet Middle: Brent, Bruce, Eider, Heather, Hutton, Ninian, Tern Lower to Middle: Beatrice Dotty, Douglas, Esmond, Hamilton, J-Block, Morecambe Bay Lower: Hewett Lower Permian (Rotliegend): Camelot, Indefatigable, Leman, Viking, West Sole In

1296-481: Is B. It was originally traded on the open outcry International Petroleum Exchange in London starting in 1988, but since 2005 has been traded on the electronic Intercontinental Exchange , known as ICE. One contract equals 1,000 barrels (159 m) and quoted in U.S. dollars . Up to 96 contracts, for 96 consecutive months, in the Brent crude oil futures contract series are available for trading. For example, before

1368-534: Is a light crude oil (LCO), though not as light as West Texas Intermediate (WTI). It contains approximately 0.37% of sulphur , classifying it as sweet crude , yet not as sweet as WTI. Brent is suitable for production of petrol and middle distillates . It is typically refined in Northwest Europe. Brent Crude has a density of approximately 835 kg/m , being equivalent to a specific gravity of 0.835 or an API gravity of 38.06. The Brent Index

1440-582: Is a heavy crude oil with an API gravity level of 20.5°." The Canadian Crude Index (CCI) serves as a benchmark for oil produced in Canada . It allows investors to track the price, risk and volatility of the Canadian commodity. The CCI provides a fixed price reference for Canadian crude oil and provides an accessible and transparent index to serve as a benchmark to build investable products upon, and could ultimately increase its demand to global markets. Because of its excellent liquidity and price transparency,

1512-461: Is always a spread between WTI, Brent and other blends due to the relative volatility (high API gravity is more valuable), sweetness/sourness (low sulfur is more valuable) and transportation cost. This is the price that controls world oil market price. West Texas Intermediate is used primarily in the U.S. It is light ( API gravity ) and sweet (low-sulfur) thus making it ideal for producing products like low-sulfur gasoline and low-sulfur diesel. Brent

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1584-473: Is calculated as an average of the following elements: Oil marker A benchmark crude or marker crude is a crude oil that serves as a reference price for buyers and sellers of crude oil. There are three primary benchmarks, West Texas Intermediate (WTI), Brent Blend , and Dubai Crude . Other well-known blends include the OPEC Reference Basket used by OPEC , Tapis Crude which

1656-540: Is currently estimated at ≈96 × 10 ^  cu ft (2,700 km ) recoverable gas reserves. Smaller discoveries to the west of Groningen followed. The UK Continental Shelf Act came into force in May 1964. Seismic exploration and the first well followed later that year. It and a second well on the Mid North Sea High were dry, as the Rotliegendes was absent, but BP's Sea Gem rig struck gas in

1728-582: Is exported. For many years it was the only freely traded oil in the Middle East, but gradually a spot market has developed in Omani crude as well. For many years, most of the oil producers in the Middle East have taken the monthly spot price average of Dubai and Oman as the benchmark for sales to the Far East (WTI and Brent futures prices are used for exports to the Atlantic Basin). In July 2007,

1800-401: Is not as light or as sweet as WTI but it is still a high-grade crude. The OPEC basket is slightly heavier and more sour than Brent. As a result of these gravity and sulfur differences, (at least before 2011) WTI is typically traded at a dollar or two premium to Brent and another dollar or two premium to the OPEC basket. Since 2011, WTI has traded at lower prices than Brent. Brent Crude is

1872-442: Is not geographically part of the North Sea. Brent crude is still used today as a standard benchmark for pricing oil, although the contract now refers to a blend of oils from fields in the northern North Sea. From the 1960s to 2014 it was reported that 42 billion barrels of oil equivalent (BOE) had been extracted from the North Sea since when production began. As there is still an estimated 24 billion BOE potentially remaining in

1944-579: Is often difficult to forecast future discoveries. Official production data from 1995 to 2020 is published by the UK government. Table 3.10 lists annual production, import and exports over that period. When it peaked in 1999, production of North Sea oil was 128 million tonnes per year, approx, 950,000 m³ (6 million barrels ) per day, having risen by ~ 5% from the early 1990s. However, by 2010 this had halved to under 60 million tonnes/year, and continued declining further, and between 2015 and 2020 has hovered between 40 and 50 million tonnes/year, at around 35% of

2016-529: Is the cash settlement price for the Intercontinental Exchange (ICE) Brent Future based on ICE Futures Brent index at expiry. The index represents the average price of trading in the 25-day Brent Blend, Forties, Oseberg, Ekofisk (BFOE) market in the relevant delivery month as reported and confirmed by the industry media. Only published cargo size (600,000 barrels (95,000 m)) trades and assessments are taken into consideration. The index

2088-501: Is the world's busiest, with 500,000 passengers per year. Following the 1958 Convention on the Continental Shelf and after some disputes on the rights to natural resource exploitation the national limits of the exclusive economic zones were ratified. Five countries are involved in oil production in the North Sea. All operate a tax and royalty licensing regime. The respective sectors are divided by median lines agreed in

2160-617: Is traded in Singapore, Western Canadian Select used in Canada, Bonny Light used in Nigeria, Urals oil used in Russia and Mexico's Isthmus . Energy Intelligence Group publishes a handbook which identified 195 major crude streams or blends in its 2011 edition. Benchmarks are used because there are many different varieties and grades of crude oil . Using benchmarks makes referencing types of oil easier for sellers and buyers. There

2232-526: The East Midlands lifted production to 400 m³ (2,500 barrels) per day, and a second wave of exploration from 1953 to 1961 found the Gainsborough field and ten smaller fields. The Netherlands' first oil shows were seen in a drilling demonstration at De Mient during the 1938 World Petroleum Congress at The Hague. Subsequent exploration led to the 1943 discovery by Exploratie Nederland, part of

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2304-536: The Montrose Field about 217 km (135 mi) east of Aberdeen . The original objective of the well had been to drill for gas to test the idea that the southern North Sea gas province extended to the north. Amoco were astonished when the well discovered oil. BP had been awarded several licences in the area in the second licensing round late in 1965, but had been reluctant to work on them. The discovery of Ekofisk prompted them to drill what turned out to be

2376-504: The North Sea , Norway's Equinor natural-gas platform Sleipner strips carbon dioxide out of the natural gas with amine solvents and disposes of this carbon dioxide by geological sequestration (" carbon sequestration ") while keeping up gas production pressure. Sleipner reduces emissions of carbon dioxide by approximately one million tonnes a year; that is about 1 ⁄ 9000th of global emissions. The cost of geological sequestration

2448-513: The Norwegian Continental Shelf . Total reserves of the field are estimated at 1.7 to 3.3 billion barrels of gross recoverable oil, and Johan Sverdrup is expected to produce 120,000 to 200,000 barrels of oil per day. Production started on 5 October 2019. As of January 2015 , the North Sea was the world's most active offshore drilling region, with 173 active rigs drilling. By May 2016, the North Sea oil and gas industry

2520-775: The Royal Dutch/Shell company Bataafsche Petroleum Maatschappij, of oil under the Dutch village of Schoonebeek , near the German border. NAM found the Netherlands' first gas in Zechstein carbonates at Coevorden in 1948. 1952 saw the first exploration well in the province of Groningen, Haren-1, which was the first to penetrate the Lower Permian Rotliegendes sandstone that is the main reservoir for

2592-512: The brent goose ). But it is also a backronym or mnemonic for the formation layers of the oil field: Broom, Rannoch, Etive, Ness and Tarbert. Petroleum production from Europe, Africa, and the Middle East flowing West tends to be priced relative to this oil, i.e. it forms a benchmark. The other well-known classifications (also called references or benchmarks ) are the OPEC Reference Basket , Dubai Crude , Oman Crude , Shanghai Crude, Urals oil and West Texas Intermediate (WTI). Brent blend

2664-427: The 1999 peak. From 2005 the UK became a net importer of crude oil, and as production declined, the amount imported has slowly risen to ~ 20 million tonnes per year by 2020. Similar historical data is available for gas. Natural gas production peaked at nearly 10 trillion cubic feet (280×10 m³) in 2001 representing some 1.2GWhr of energy; by 2018 UK production had declined to 1.4 trillion cubic feet, (41×10 m³). Over

2736-649: The British sector, a result of a ban on gas exports and low prices offered by the only buyer, British Gas . West Sole came onstream in May 1967. Licensing regulations for Dutch waters were not finalised until 1967. The situation was transformed in December 1969, when Phillips Petroleum discovered oil in Chalk of Danian age at Ekofisk , in Norwegian waters in the central North Sea. The same month, Amoco discovered

2808-636: The North Sea (onshore, West of Shetland). United Kingdom Continental Shelf production was 137 million tonnes of oil and 105 billion m³ of gas in 1999. (1 tonne of crude oil converts to 7.5 barrels). The Danish explorations of Cenozoic stratigraphy, undertaken in the 1990s, showed petroleum-rich reserves in the northern Danish sector, especially the Central Graben area. The Dutch area of the North Sea followed through with onshore and offshore gas exploration, and well creation. Exact figures are debatable, because methods of estimating reserves vary and it

2880-541: The Norwegian North Sea alone (excluding smaller reserves in Norwegian Sea and Barents Sea) of which 2,778 million cubic metres (60%) has already been produced prior to January 2007. UK sources give a range of estimates of reserves, but even using the most optimistic "maximum" estimate of ultimate recovery, 76% had been recovered as of the end of 2010. Note the UK figure includes fields which are not in

2952-632: The WTI contracts. Brent futures contracts could theoretically access the storage capacity of all the shore tanks in North West Europe and of available shipping storage, while CME WTI contracts are restricted to storage and pipeline capacity at Cushing only. Brent futures contracts are traded in relation with Dated Brent and other contracts in the Brent Complex, allowing other contracts in the system to absorb demand shocks. Up to April 20, most of

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3024-765: The West Sole Field in September 1965. The celebrations were short-lived since the Sea Gem sank, with the loss of 13 lives, after part of the rig collapsed as it was moved away from the discovery well. The Viking Gas Field was discovered in December 1965 with the Conoco /National Coal Board well 49/17-1, finding the gas-bearing Permian Rotliegend Sandstone at a depth of 2,756 m subsea. Helicopters were first used to transport workers. Larger gas finds followed in 1966 – Leman Bank, Indefatigable and Hewett – but by 1968 companies had lost interest in further exploration of

3096-598: The assessed Dated Brent price, and created incentives for speculative squeezes. Platts and other PRAs got around the problem by quoting both a dated Brent assessed on outright spot market transactions, and a "North Sea Date Brent Strip" assessed using a Front Month Brent forward price curve created out of adding the Brent Front Month contract price and relevant weekly Brent contracts-for-difference (CFD) prices. These dated Brent prices became less vulnerable to speculative squeezes, since market actors who try to corner

3168-691: The coast by railroad, which is much more expensive than pipeline. On April 20, 2020, the CME WTI futures contract for May 2020 settled at −US$ 37.63 a barrel due to oil demand shocks from the COVID-19 pandemic , and to dwindling storage capacity at the futures contract delivery point at Cushing, Oklahoma. Brent settled for US$ 26.21 at the same time, for a difference of $ 63.84. While the oil demand shock and limited storage capacity affects both WTI and Brent futures contracts, Brent contracts have greater access to storage, and greater buffers to absorb demand shocks than

3240-551: The contract is used as a principal international pricing benchmark. The first futures contracts on crude oil were traded in 1983, with the Chicago Board of Trade (CBOT) and the New York Mercantile Exchange (Nymex) both attempting to take advantage of the government's de-regulation of crude oil. CBOT's initial contracts had delivery problems, so customers abandoned it for Nymex. Crude oil became

3312-400: The current month in the spot market. Spot market transactions are generally not public, so market participants usually analyzed Dated Brent prices using assessments from Price Reporting Agencies (PRAs), who collect private transactions data and aggregate them. The important PRAs for the Brent Complex are Platts , Argus , and ICIS. Platts dominates the assessed Dated Brent price, Argus publishes

3384-807: The delivery date. From 1983 to 1985, these contracts were for 500,000 barrels of Brent Blend crude, and were increased to 600,000 barrels after 1985. Deals were made bilaterally between two parties by telephone and confirmed by telex . Payment for deals were made 30 days after oil delivery. Since deals were bilateral and not centrally cleared like futures transactions, parties to the deal sought financial guarantees such as letters of credit to minimize counterparty credit risk . Contracts for one and two months forward were available in 1983, contracts for three months forward were available in 1984, contracts for four months forward were available in 1985, and contracts for at least four months are available for trading today. Sellers of Brent forward contracts initially had to give buyers

3456-497: The delivery month. Although price discovery for the Brent Complex is driven in the Brent forward market, many hedgers and traders prefer to use futures contracts like the ICE Brent futures contract to avoid the risk of large physical deliveries. If the market participant is using Brent futures to hedge physical oil transactions based on Dated Brent, they will still face basis risk between Dated Brent and EFP prices. Hedgers could use

3528-544: The demand shock from the COVID-19 pandemic has been absorbed by Dated Brent contracts and Dated Brent quality differentials, which spared pricing pressure on Brent futures contracts. While Brent is more insulated to negative pricing by these factors than WTI, negative prices are still possible should oil demand and storage capacity fall further. Brent crude oil monthly forward contracts started trading in 1983 as "open" contracts, or contracts that specify delivery month but not

3600-541: The depletion of the North Sea oil fields. The US Energy Information Administration attributes the price spread between WTI and Brent to an oversupply of crude oil in the interior of North America (WTI price is set at Cushing, Oklahoma ) caused by rapidly increasing oil production from unconventional reservoirs such as Canadian oil sands and tight oil formations such as the Bakken Formation , Niobrara Formation , and Eagle Ford Formation . Oil production in

3672-620: The diverse needs of the physical market. North Sea oil North Sea oil is a mixture of hydrocarbons , comprising liquid petroleum and natural gas , produced from petroleum reservoirs beneath the North Sea . In the petroleum industry , the term "North Sea" often includes areas such as the Norwegian Sea and the area known as "West of Shetland", "the Atlantic Frontier" or "the Atlantic Margin" that

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3744-490: The end of trading for a particular day. Trading in these windows are dominated by group of major market participants, as listed in the table below. Originally Brent Crude was produced from the Brent Oilfield . The name "Brent" comes from the naming policy of Shell UK Exploration and Production, operating on behalf of ExxonMobil and Royal Dutch Shell , which originally named all of its fields after birds (in this case

3816-615: The flood of computation required). The Gullfaks oil field was discovered in 1978. The Snorre Field was discovered in 1979, producing from the Triassic Lunde Formation and the Triassic-Jurassic Statfjord Formation, both fluvial sandstones in a mudstone matrix. The Oseberg oil field and Troll gas field were also discovered in 1979. The Miller oilfield was discovered in 1983. The Alba Field produces from sandstones in

3888-513: The gas fields of the southern North Sea, although in Haren-1 it contained only water. The Ten Boer well failed to reach target depth for technical reasons, but was completed as a minor gas producer from the Zechstein carbonates. The Slochteren-1 well found gas in the Rotliegendes in 1959, although the full extent of what became known as the Groningen gas field was not appreciated until 1963—it

3960-582: The interior of North America has exceeded the capacity of pipelines to carry it to markets on the Gulf Coast and east coast of North America; as a result, the oil price on the US and Canadian east coast and parts of the US Gulf Coast since 2011 has been set by the price of Brent Crude, while markets in the interior still follow the WTI price. Much US and Canadian crude oil from the interior is now shipped to

4032-428: The last trading date for May 2020, 96 contracts, from contracts for May 2020, June 2020, July 2020 ... Mar 2028, April 2028, and May 2028 are available for trading. ICE Clear Europe acts as the central counterparty for Brent crude oil and related contracts. Brent contracts are deliverable contracts based on 'Exchange of Futures for Physicals' (EFP) delivery with an option to cash settle against the ICE Brent Index price for

4104-534: The last trading day of the futures contract. In addition to ICE, two types of Brent crude financial futures are also traded on the NYMEX (now part of the Chicago Mercantile Exchange (CME) . They are ultimately priced in relation to the ICE Brent crude oil futures and the ICE Brent Index. Brent Crude Oil Penultimate Financial Futures , also known as Brent Crude Oil Futures , are traded using

4176-453: The late 1960s: The Norwegian and British sectors hold most of the large oil reserves. It is estimated that the Norwegian sector alone contains 54% of the sea's oil reserves and 45% of its gas reserves. More than half of the North Sea oil reserves have been extracted, according to official sources in both Norway and the UK. For Norway, Oljedirektoratet gives a figure of 4,601 million cubic metres of oil (corresponding to 29 billion barrels) for

4248-500: The market for wholesale trade, hedging, and tax purposes. Producers without integrated refinery operations, and vice versa for refiners without oil production, had to sell oil and could hedge oil price risk with forward contracts. Integrated oil producers (those with refinery operations) had the same motives, but had an extra incentive to lower taxes. Integrated oil producers faced taxes when transferring oil internally from production to refining operations. These taxes are calculated based on

4320-532: The middle Eocene Alba Formation at 1860 m subsea and was discovered in 1984 in UKCS Block 16/26. The Smørbukk Field was discovered in 1984 in 250–300 m of water that produces from Lower to Middle Jurassic sandstone formations within a fault block. The Snøhvit Gas Field and the Draugen oil field were discovered in 1984. The Heidrun oil field was discovered in 1985. The largest UK field discovered in

4392-487: The most likely amount to be found would be between 15 billion and 16 billion barrels. Commercial extraction of oil on the shores of the North Sea dates back to 1851, when James Young retorted oil from torbanite (boghead coal, or oil shale) mined in the Midland Valley of Scotland. Across the sea in Germany, oil was found in the Wietze field near Hanover in 1859, leading to the discovery of seventy more fields, mostly in Lower Cretaceous and Jurassic reservoirs, producing

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4464-529: The oil, and long chains of speculators formed between producers and refiners for every cargo of oil traded. Integrated oil producers also blurred the lines between commercial and speculative activity, as they could re-direct physical oil cargoes, and choose which forward contracts to deliver and which contracts to pass on to other speculators or producers. Front Month Brent forward contracts prices came to be used as reference prices for spot transactions, but became vulnerable to speculative squeezes. The development of

4536-420: The past twenty-five years is Buzzard , also located off Scotland, found in June 2001 with producible reserves of almost 64×10 m³ (400m bbl) and an average output of 28,600 m to 30,200 m (180,000–220,000 bbl) per day. The largest field found in the past five years on the Norwegian part of the North Sea is the Johan Sverdrup oil field , which was discovered in 2010. It is one of the largest discoveries made in

4608-431: The pricing differential of heating oil futures and crude oil futures and gasoline futures and crude oil futures; and average price options. The contract trades in units of 1,000 barrels, and the delivery point is Cushing, Oklahoma , which is also accessible to the international spot markets via pipelines. The contract provides for delivery of several grades of domestic and internationally traded foreign crudes, and serves

4680-426: The reservoir (equivalent to about 35 years worth of production), the North Sea will remain as an important petroleum reservoir for years to come. However, this is the upper end of a range of estimates provided by Sir Ian Wood (commissioned by the UK government to carry out a review of the oil industry in the United Kingdom ); the lower end was 12 billion barrels. Wood, upset with how his figures were being used, said

4752-442: The same market. This practice became less prevalent with the introduction of tougher regulations in 1987. Speculators became bilateral intermediaries between producers and refiners, and speculative deals came to dominate the forward market. Since there was no central clearing of those forward contracts, speculators who bought Brent forwards at the time and who do not want to take delivery of physical oil must find other parties to take

4824-551: The spot market will find that other market participants can sell on the front month forward market or on prices referenced to a front month forward market price, and market actors who try to monopolize the front month forward market will find that they would lose what they earned in the forward market in the spot market, as price effect they created in the front month contract will pass on to the dated Brent prices. Platt's compile their assessment prices during price assessment 'windows', or specific times of market trading, usually close to

4896-408: The symbol BB, and are cash settled based on the ICE Brent Crude Oil Futures 1st nearby contract settlement price on the penultimate trading day for the delivery month. Brent Last Day Financial Futures , also known as Brent Crude Oil Financial Futures , are traded using the symbol BZ, and are cash settled based on the ICE Brent Crude Oil Index price as published one day after the final trading day for

4968-937: The two main benchmark prices for purchases of oil worldwide, the other being West Texas Intermediate (WTI) . Popular media references to "Brent crude" usually refers to the ICE Brent crude oil futures price. The ICE Brent crude oil futures price is part of the Brent Complex , a physical and financial market for crude oil based around the North Sea of Northwest Europe, which could include numerous elements that can be referred to as Brent crude: The Brent Complex fosters commercial transactions of Brent crude oil, gathers price data those transactions (in forwards, CFDs, and Dated Brent), establishes reference prices for other global oil trade transactions (in Dated Brent assessed prices, Dated BFOET assessed prices, forward traded prices, and futures traded prices), and transfers risks of those transactions (through hedging in forward and futures markets). The ICE Futures Europe symbol for Brent crude oil futures

5040-415: The world's most actively traded commodity , and the NYMEX Division light sweet crude oil futures contract becoming the world's most liquid form for crude oil trading, as well as the world's largest-volume futures contract trading on a physical commodity. Additional risk management and trading opportunities are offered through options on the futures contract; calendar spread options; crack spread options on

5112-455: Was financially stressed by the reduced oil prices , and called for government support. The distances, number of workplaces, and fierce weather in the 750,000 square kilometre (290,000 square mile) North Sea area require the world's largest fleet of heavy instrument flight rules (IFR) helicopters, some specifically developed for the North Sea. They carry about two million passengers per year from sixteen onshore bases, of which Aberdeen Airport

5184-483: Was seen in 1999, with offshore oil production in that year of 407×10 m³ (398 million barrels) and had declined to 231×10 m³ (220 million barrels) in 2007. This was the largest decrease of any oil-exporting nation in the world, and has led to Britain becoming a net importer of crude for the first time in decades, as recognized by the energy policy of the United Kingdom . Norwegian crude oil production as of 2013

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