Oil is a mixture of hydrocarbons that have originated from the decomposition of organic matter in the absence of oxygen in a few episodes Global Warming hundreds of millions of years ago. The remains of marine organisms, mostly algae, in periods of high heat sink to the bottom of the sea or lakes and lagoons and they were buried by sediments.
The formation of oil from the original organic matter is a fairly well-known process that requires a real "cooking" at temperatures not lower than 60 - 80 ° C to no more than 150 ° C.
These conditions are in the earth's crust at a depth of not less than 2 km and not more than 4.5 km, the so-called oil window. The conditions in which oil is formed are quite rigid and therefore can not be tried anywhere. These conditions are five and are a check list that needs to be explored fully satisfied that the area contains oil:
existence of a "bedrock" of rich organic matter, which are quickly buried by sediment and thus removed from contact with 'oxidizing atmosphere. The sediment thus formed (parent rock) must be brought in depth, temperatures and pressures that allow the digestion / firing of complex organic molecules into smaller molecules (oil window: 80 - 150 ° C, 2.2 -4.5 km depth).
Existence of a "reservoir rock." The host rock in its pores formed in the cooking liquid. The porous rocks that may contain oil essnzialmente are of two types: sandstone and limestone. The oil is contained in the pores of the rock like water in a sponge.
Existence of a "cap rock" that prevents the oil escaping into the surface of the earth's crust. These rocks are typically referred to as evaporites, such as anhydrous gypsum (calcium sulphate) and rock salt (calcium chloride: table salt). The major oilfields of the Middle East are just trapped by a layer of dioxide.
Existence of a "trap" that is a curvature of the cap rock that prevents the oil to escape from the side of the rock formation.
No fractures in the cap rock to escape from such oil.
Starting in the late 90 'the issue of peak oil has become a topic of growing interest and public domain. The peak is simply the maximum of oil production that occurs over time for each oil field. The explanation for this phenomenon is intuitive and relates the increasing difficulty of extraction phases as described above. Reached the maximum production amount of oil extracted inexorably declines. Today when we talk about peak oil, it refers mostly to the global peak, ie the maximum of world oil production. ASPO Italy is the association that studies the phenomenon of Peak Oil.
Oil is the most traded commodity in the world.
The main oil futures contract is traded based on the NYMEX in New York. This future is based on the quality of oil that West Texas Intermediate (WTI).
This is a quality "light", ie low density, and therefore, more valuable because of its refining are obtained great value products (gasoline, heating oil, jet fuel, etc.. etc...)
Besides being light, the NYMEX contract is also "sweet", that contains a quantity of less than 0.5% sulfur and is therefore less polluting. The organization of oil producing countries (OPEC) produces about 38% of the extracted oil in the world. In particular, in the main producing countries of OPEC are Saudi Arabia, Iran, Kuwait and Venezuela. The U.S. and the former USSR each produce about 12% of the world's oil. OPEC has a great influence on oil prices as by cutting or increasing production have a major impact on supply. One must always bear in mind, however, that the goal of OPEC is to maximize their profits and not officially declared, to keep the price of crude oil in a narrow fluctuation band.
addition, OPEC production quotas are not always fully complied with by individual countries, which often makes the actual OPEC production is higher than officially declared
.
Oil as it has many uses and so the demand is greater than oil from refineries to refine it by fractional distillation,
for the separation of the main components that constitute it (gas, petrol, diesel, naphtha, etc.. etc...)
From a barrel of oil (42 gallons) you get 19.5 gallons of petrol (gasoline), 9.2 gallons of "spirits" (mostly heating oil), and 4.2 gallons of kerosene and jet fuel. The rest are used in lubricants and chemicals sector. Some of these petroleum products are the underlying futures contracts. Description
contract
Name: Petroleum (crude oil)
CL
Months contract signed date: January, February, March, April, May, June, July, August, September, October, November, December,
Stock Exchange: NYMEX, New York Mercantile Exchange
Example: from 120.00 to 121.00 = $ 1,000
minimum price variation (tick) 0.01
Tick Value: $ 10
trading hours: Electronic: from 6: 00p.m. - At 5:15 p.m. NY hours, Dom-Fri.
Shout: 9:00 a.m. at 2:30 p.m. NY hours, Mon.-Fri.
contract size: 1000 barrels contract
Quote: dollars and cents per barrel
