Crude Oil Futures Analysis By Philip Moufarrige

Philip Moufarrige is working for ICAP. ICAP provides with global financial services. He is dedicated and focused in Oil and Energy Industry. He basically belongs to London and has done his education from the European Business School. ICAP facilitates the flow of investment and capital through financial system. It supports corporate borrowing as well as government borrowing.

He has an experience of about 15 years and 1 month as a Crude Oil options broker. His main skills constitute the risk management, financial marketing, proprietary trading and business strategy and its various approaches. He is well versed in providing ideas on venture capital, trading system, hedge funds, petroleum, and different trading strategies.

ICAP offers broking services for wide variety and choice of assets which includes commodities, all the emerging markets, equities and credits.

 

The trading of oil

For Philip Moufarrige, oil is one of the most important and the most frequently traded commodities of the world. The prices of the oil commodities have repercussions for everyone, as oil is used in so many ways and in various products.

One of the major use of oil is petroleum. A large and huge percentage of modern vehicles use petroleum as fuel, and therefore a large proportion of the world’s transportation industry depends on it. The world’s transport infrastructure is fundamental for almost every trade in the world to function, and as a result a crude oil price affects the cost of running all of the transport. Companies have to accommodate with all the price fluctuations.

 

Future of Crude Oil

The commodity trading in crude oil is based on Cents and US Dollars per barrel. Therefore, the price of the Crude oil are based on which blend is used. There are about 161 different types of blends that are found around the world. Out of these, there are four primary blends that are considered as benchmarks:

•     Brent Crude oil
•     Western Texas Intermediate
•     Dubai Crude
•     Organization of the Petroleum Exporting Countries Basket.

ICAP and Philip Moufarrige have changed the lives of many people by donating all the commissions and revenues on one day every year. ICAP has brought positive change among  thousands of people across the globe.

Philip Moufarrige - Startups seen as a route higher investor return in crude oil

As the investment based on buy and forget seems to be a very decent bet these days when it comes to crude oil cases. But to find a way to track the price is however not a straightforward work. Philip Moufarrige is one of the eminent people involved in crude oil extracting. If somebody will ask some of the adventurous investors to give a name to an asset that can really double the value for next five years, the only name that comes in mind of people is crude oil.

It may also come up with the fact that it could really halve the value as well but for those products in the market with high risk, to play somewhat like buy and forget then it definitely has to be crude oil which would fit in the criteria. Even if you analyze that you are existing in the high supply era and low demand, then you are definitely wrong. Such commodities put sizeable gain to the products in the market and still remain suppressed by the current standard of the market. Philip Moufarrige has contributed a lot in this felid.

An average of 17 numbers of forecasts which were compiled by Bloomberg in the last week was Brent crude at the end of the year at approximate $48 barrels. All of a sudden there was a hike on the price seen lately. Even if the investing question is put to an expert they will also never neglect this fact, this is a real time, good source of investment. Philip Moufarriage has brought about lots of changes in this field.

From the view of our experts:

There are many people who would happily take this chance to bet on this factor. The only question which arises is that, is there any possible way to do that? Many people have enough of money to invest but they are not aware of where to invest so as to get a better return on investment. The Exchange Traded Fund offers you with very low cost investing criteria for most of the investors who are doing it for the first time. Philip Moufarriage will be there to guide you all through this procedure.

Moreover, there are some collective form of investment too, which seeks to the mirror performance and it is considered as an asset. This could be basically done in case of crude oil and other such commodities. Exchange Traded Fund could be carried out for various small investors. In such cases it could be compared with some other possible avenues for all those who want to bet on it.

About Exchange Traded Fund:

Exchange Traded Fund is listed in the list of stock exchange and almost all the investors buy and sell shares in it. Those products which are designed to stock market price can easily match to their entire chosen index much closely, by buying share from the index either directly or by matching the overall return through more complicated form of financial contracts. But somehow crude oil is a different story overall.

Like the certificates based on sharing, you cannot store the oil electronically or in any kind of filling cabinet. Even after comparing it with gold, which can easily be stored physically on behalf of the one who is investing in it. But at times it also has to be transported from one place to another. But, sometimes investing on oil is a very complicated business.  

Darius McDermott the managing director of Chelsea Financial Services had said something on this note, he said, The main problem is that it is too difficult to store 1,000 barrels so that Exchange Traded Fund comes out to be the next big thing in the market. Philip Moufarriage also agreed to this. It also helps knowing the price of the oil in future. At least it could easily be estimated. He wants that in future people should be able to buy oil at a very affordable price which would not at all be heavy on their pocket.

Nevertheless, the future price is greatly affected by the current price of the crude oil. This is known as the spot price. But at times there are also some subjects that can include changes n the cost of the crude oils. It also includes the cost of storing and transporting the oil. Exchange Traded Fund needs to be replaced by some of the other essential elements to be exported and imported.

Whenever the price of the oil is expected to rise, the new contrast which has to be replaced becomes more and more expensive. At times it becomes very difficult for the exporter to shoulder that particular cost. Sometimes it is also considered as the underperformance cost. The term used for the future market getting more expensive is known as Contango and when they are getting cheaper it is known as Backwardation.

In this regards, McDermott says that he had researched to follow the crude oil price quite closely when the market was facing Backwardation but it may undershoot as it moves to Contango. The only problem faced by the investors in that when and how to know about the details of the market, they remain totally unaware of the ups and downs in the market. Philip Moufarriage is an expert in dealing with these problems.

To add more to this it has been said that the uncertainty of the hike in price may lead to a great loss to the whole market. People believe that they should at least be well aware about the ups and downs of the market so that they could also deal efficiently with it. Those who buy the future contracts are just one month away from the expiry period. This will lead you more closely to the deadline. One could ultimately figure out that this potential of the investors may get the wrong product to high rate. In such cases most of the financial professionals may have to struggle. Philip Moufarriage has really done justice to the crude oil industry.            

Investors of crude oil are facing a tough time

Lots of investors tend to face much problem this year due to the ups and down sin the price of the crude oil. This is all due to some of the recent events like Trump’s election and Brexit. These have completely shattered the market. Rather those companies with very few investments have not faced many problems. Lots of investors are being affected by this. Philip Moufarrige has shown us the true face of the crude oil companies.

All the investors in UK have allotted a significant amount of their earning to the investments. Almost 3% of them have allocated and about 90%-100% of them are still suffering the chaos. Whereas 25% of them are getting the actual value they have invested. People have started working harder to make lots of money. But with the current scenario of crude oil many people and the investors are facing difficulty. With the guidance of Philip Moufarrige the scenario of crude oil is much clear to the investors.

The start-up scene of 2016 was appreciated a lot by the UK investors. FTI consulting has also witnessed this and has given an approval for this. According to the survey done, most of the investors were not much satisfied, the overall satisfaction percentage was only 50%, and rest 50% were considered to be off the track when the meeting was conducted from the financial goal. Approximately those who are investing on crude oil said that they have even got zero return on their investment. They are expecting to get something better this year.

Somehow tough time for the investors:

From the past 20 years there has been a decline in the interest rates. In the mind 90s, the 10 years yield on the government had lots of debt in the rich countries had hovered around 8%-10% but as per the researches these days they have really gown down to 2%. This is really very annoying and depressing for the investors. Philip Moufarrige has tried a lot to keep things balanced.  

It is not only about the government debt that has been dropped down but a lot has been changed with time in this sector. Even more in Germany and France they have also witnessed much downfall in the manufacture of the crude oil. If they are not holding enough maturity then it is very sure that they will suffer lots of cash loss. The decline in interest rate is all because of the bond due to some of the bond buying by central banks which are also known as quantitative easing. Something which is more important than this is secular sanitation. Some of the factors like ageing in particular have somehow increased the saving rates and have pushed down the global aggregate demands. The high supply of savings, the low demand of borrowing has completely dropped down the market and has made the records very low. The contribution of Philip Moufarrige is remarkable in this field.

As it could have been expected, the sudden decline in the interest rates poses a threat to the investors by making it quite difficult for the investors. Upon this the market value has reached the increasing side only because of all the after effects of the financial crisis last year. But apart from this due to some of the phenomena like the slowdown in the Chinese economic status this have been affected a lot. Some other factors are the US election and the Brexit issue. But in all these fuss, the earlier stage of the crude oil company manages to perform really well.

The stage of early companies considered to provide higher returns:

This fact should be well known to all the investors that investing at a very early stage may be very risky. A start up business needs lots of support in the market. Usually it has been notices that nine out of ten new startup companies have failed. You need to manage some of the early investors who can manage to hold you company even at bad times. You need to try your best to make your company more and more appealing. According to the upcoming data, almost one third of the respondents have cited the prospect for the higher return rates.

This may turn out to be the big step to move early into the investment. This could be matched on such ground that early rising companies could see any benefit in it. For this you also need the venture stage and thus the growth could be abolished.

Between the year 2011- 2016 most of the early budding companies have scored 33% of the annual growth where as in the same time frame the London stock exchange market have scored around 5% of the annual growth rate. If looking at the growth through valuation perspective you may find the result very startling. Philip Moufarrige is one of the known faces when it comes to dealing with crude oil. By September 2016 the proportion has gone up drastically.

Philip Moufarrige working on Oil Industry

Oil is one of the most important raw materials that we have. Every day there are a hundreds of things which are used that are made from oil or gas. Also, oil and gas are important because of the job opportunities they provide to many people. Ten out of thousand people work in gas as well oil industries.

How is oil and gas formed?

• Both Gas as well as crude oil is found underground.
• If you study well, most of the world is covered by sea. The sea further contains tiny animals and plants. These tiny animals and plants are referred to as planktons. They get their energy to live and multiply it from sunlight. When they die they go under the surface of the bottom of the sea
• The planktons which die millions of years ago are the source for today's oil and gas
• The Dead Sea creatures get buried by sand and mud at the bottom of the sea. It is said that
  the sun's energy gets stored in the bodies of the dead creatures as well plants. The dead bodies later start decaying.
•  From over a million of years the dead animals and plants have been buried deeper and deeper. The squashed and solid creatures turn into oil and gas.
• The force and temperature of deep, underground turns the chemicals of decaying animals and plants into crude oil and gas.

How do we get oil and gas out of the ground?

According to Philip Moufarrige oil and gas both get trapped in pockets underground such as where the rocks are folded into an umbrella shape.  Oil and the gases can move through the rocks with the gaps between the grains. They further move upwards from the source rock where they can be formed. When they meet a cap rock, the oil and gases get trapped in it. A well is drilled so crude oil as well as other liquids can travel the bore hole. Finding a gas and oil trapped deep underground drilling is way too complicated and also very expensive.  It can cost about a million of pound to drill.

The liquids that are underground are said to be a mixture of crude oil, gas and water. Before transporting both of these, they need to be separated.

How are oil and gas transported?

Usually, oil and gas are found far away or under the sea. Further, they are transported to an oil refinery through a pipeline or tanker. Crude oil is found in places like jungle, deserts or the arctic. They are transported through the pipelines by the rail, road, boats along canals and rivers.

Know about Oil industry from the expert Philip Moufarrige

Oil is the lifeblood of the industrialised nation. Since mid 1950’s, the Oil has become world's most important source of energy. The oil products underpin modern society, and mostly supply energy to power industries, heat homes and provide fuel for vehicles and aeroplanes that carry goods and people all over the world.

 Why is oil important?

According to Philip Moufarrige, oil meets about 97 per cent of the demand of the UK transport sector. In addition, it also benefits our lives with the production of everyday essentials. Further, Oil’s refined products are used to manufacture almost all the chemical products, like fertilisers, plastics, detergents, paints and also medicines. There are a whole host of other products that you might not even think or expect.

It's easy and very understandable why oil is important in our lives. No one can drive their car unless it is filled with petrol or gasoline. Even the school bus requires gasoline. Aeroplanes too require petrol to fly otherwise they would be on the ground stand still and rusting.

Other than being used in vehicles oil is use in several other products too like cosmetics, plastic goods and toys, nylon clothing, farm fertilizers, and other detergents. Even the waxes which are used for chewing gum are made from oil. Around one-fourth of the oil is used for chemical plants, heating and other industries.

Use of Oil in our everyday lives

Here are few examples of how we use oil in every day of our lives:

•    In school: Oil is used in ink, rulers, crayons, cartridges, coverings on books, glue, binders 

• For health: It is used as binding agent for creams, the coatings for pills, and disposable syringes.

• In home:  In contact lenses, clothing, cosmetics, nail polish, fabrics, deodorants, carpets, shampoo, paint, upholstery and detergents for washing and laundry. Its also used as a dry-cleaning fluid.

• For shopping:  In egg cartons, shopping bags, credit cards, debit cards, shopping cards, plastic milk bottles

• While cooking: Cling films, non-stick pans, storage containers

• For construction: It is used in roofing tiles, insulating material, pipes, paint.

•   On the move:  Oil is used for the petrol and diesel of cars and lorries, emergency services and trains and asphalt road surfaces

• In the office: Phones and faxes, diskettes, computer hardware, printing ink, pens, chairs. 

• For your leisure: Cassette tapes, videos, CDs, artists' paint, camera film, football boots, crash helmets, bicycle handlebar grips, tyres, trainers, shin pads, windsurfers, roller blades.

Impact of Brexit on Oil Industry by Philip Moufarrige.

When it comes to the oil industry, it is quite difficult and somewhat exciting time for the UK over last few months. There has come up lots of economic uncertainty in the country. Its outcome was very shocking for the whole nation, everybody is much worried and tensed. They are also assured about their nearness to the political and economic uncertainty. With such changes in the economy of the country comes up the question about the impact of the referendum on the UK gas and oil industry. Philip Moufarrige has contributed a lot in the oil and gas industry.

Effect of Brexit on oil and gas industry:

The effect of pound declined dramatically over a period of time. This shows that it is trying to recover itself from the tome of the shocking Brexit. The rates of oils are going down drastically and thus we may see the oil companies coming to an end. But the fall in the price of oil was not due to the Brexit, rather it was due to the strengthening of US dollar and something more important from this is the economy of the nation and its demand and supply system.

The North Sea oil and gas industry is also facing the tremendous problem and may shut down in some time. It seems it is quite uncertain to solve this problem with the advancing time. Philip Moufarrige still believes that sooner or later a time will come when things will settle down.

The North Sea oil and gas industry:

Philip Moufarrige has a lot o say on this. It has also faced a real tough time in recent days and it has highly increased the optional cost and the price of the oil keeps fluctuating. But, unfortunately, all these issues will be affected much more bu Brexit. It has faced lots of decommissioning in recent days. Because of the Brexit, the oil and gas companies are found to be less willing to invest in the North Sea oil and gas industry. The decommissioning is increasing at a rapid pace.

The matter does not even calm down here, there is lot more issue related to it. It may still be able to benefit from this challenging situation. Assumptions are made that if the post does not manage to gain its stability, it could also help reducing some costs in the North Sea oil and gas industry. The workers may get some relaxations too.

Scottish Referendum:

As the above write up explains the Brexit denied talking about the second referendum for an independent Scotland. These kinds of cases have added much uncertainty to the future of the North Sea oil and gas industry. The matter is quite debatable when it comes to the drop in price in the entire market.

A split from the UK would also participate in the debate based on this. There are numerous oil reserves over there. This independence would most probably result in the division of the reserves. In will be allocated in the same way as the fishing rights are given to people. Scotland will be getting the majority of the annual natural oil production and the production of natural gas.

Philip Moufarrige has given a new phase to the oil and natural gas industry. It is quite undoubtedly to say that the Brexit have caused much havoc in the UK and it is quite obvious because of the ambiguity which has emerged in the recent days. In recent days it turns out to be very interesting to see how the industry has evolved in response to the emerging changes these days. It is high time to say goodbye to the UK too.