RiskTech Forum

Aspect Enterprise Solutions: The Cloud & The Importance Of Physical Operations In Oil Trading

Posted: 1 October 2013  |  Source: Aspect Enterprise Solutions   |  Source: Aspect Enterprise Solutions


Trading oil used to mostly take place in the virtual world. Oil futures were bought and sold on paper only, with relatively few physical movements of oil taking place. Meanwhile, millions of barrels of oil remained in storage,
being traded on multiple times as its value increased.

But in today’s financial climate, the market has changed. There is more money to be made by selling oil almost immediately after it has been bought. Contracts that once would have been renegotiated or unwound before
deliveries fell due are instead being allowed to run to completion. Cargos of oil are spending less time in long-term storage and more time on the move.

For today’s physical trading companies, and those companies more accustomed to dealing with on-paper trades only, it presents key challenges. This white paper examines those challenges and details how they can be met,
with the emphasis on arguably the most important element in the mix - storage.

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