Traditionally, commodity trading in petroleum products is a place where only the elite, super traders dared to venture. With barrels holding 42 gallons each, and the contract at least 1,000 barrels, delivering oil was a task best left to professionals. However, the petroleum trading landscape has undergone some dramatic changes over recent years.
For decades, oil prices were stable, then the mid-1970s the industry exploded. Technological advances and the political landscape contributed to insecurity, lack of stability, shortages and price increases. Nearly 30 years later, prices skyrocket to more than $ 70 per barrel, and forecasters predict that in the mid to late 2007, when it expects to see a slight decline for the next two years.
, however, there is no truth when it comes to oil prices, but there are few large-scale factors that can reduce risk by offering a relatively accurate projections.
As demands continue to rise, other countries like India and China are also experiencing technological and cultural promjena.Trend seems to be on the rise with no signs of slowing, reversing or reversible.
India is riding on the coattails of their western neighbors in relation to technology and business methods and is emerging in the 21st century. It brings with it increased demand for energy, mainly oil-based, so the houses, commercial buildings and manufacturing plants can be built. Rural economy is getting a facelift in many areas such as this movement carries with it such an exponential growth which, in turn, increases demand.
The demand is not just a piece of the puzzle, though. As India's purchasing power to obtain those goods increases, the growth of other shows as well. India has a wealth of cheap, educated workforce that is required for the outsourcing of information technology, electronics manufacturing, communications and more. It has continued to grow and expand for at least another decade. One indicator of this growth, the rapid growth of broadband throughout India.
China's technological mega country with the highest use of mobile phones in the world, and the other for the largest internet population. Energy is in demand around the world, but China is expected to grow steadily for at least the next decade.
Although China is considered to be a communist state, the social forces that cause performance to decline. As yet, it is impossible to predict whether repression will increase or decrease, but it is inevitable that information flow will be stopped and will reach people one way or another, despite any government attempts to block it.
of social change in China, it seems somewhat proportional increase in business there. Demand for energy is growing and new infrastructure, buildings and manufacturing plants are cropping up on a consistent basis. These companies and the growth of energy demand, mainly oil-based energy.
The demand continues to grow, but at the same cost falling off or blocked. Temporary loss, as the refineries, which occur as a result of a disaster can be recovered within a few months to a year. However, North Sea oil production, which saw its peak in 2000, has seen a gradual decline. By the time that the political change to come around, releasing massive reserves that are known to be in Alaska, is not expected to be sources of new discoveries that will be used. Not a lot of new sources are expected to achieve over the world.
As the technology is tilted towards the development of new forms of energy, there is no expectation that any of these resources will appear in the market over a period of ten years. Fuel cell powered cars, which only account for 7% of gasoline use, is not expected to look for quite a few years.
The current political pressures in the United States hopes to prevent any changes to the current situation. Disposal is one of the main problems at the political forefront that shows no promise of a solution anytime soon. However, there are new forms of oil trading mechanisms are developed to the average investor to participate in a market that was at one time exclusive.
For example, e-mini futures on the CME allow trading contracts that are half the traditional size of 500 barrels. Futures and options on NYMEX remains of 1,000 barrel size, but they require less than 5% of the investment. These moves place these trades in the understanding of all types of investors. Commodities pools and funds, such as those offered by Pimco and Oppenheimer allow investing smaller amounts that are increasing their popularity.
This time, the market can offer even the average investor a favorable risk and reward balance in the oil commodity trading.
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