Russian oil will be traded without regard to the standard grade
NYMEX is going to trade futures on Russian crude oil Urals, Vedomosti. Bidding will take place in Budapest, which has already signed a memorandum of intent. Now Urals is not traded on exchanges. It is sold at a discount to the price of standard grade Brent. The price of Brent determines the price by 65 percent of oil production, although its share in the total production of only 2 percent.
Urals is about 12 percent of the world#39;s oil exports, and so the introduction of the exchange indicator, according to the NYMEX President James Nyusama, really need to region. First exchange trading in Budapest could begin in early 2006. Budapest Stock Exchange for trading are going to attract more participants - primarily from Russia. Futures trading will be carried out without reference to the physical crude oil.
Alfa Group offered by federal officials in Moscow to establish trade futures on oil exports. The government also supports this proposal. April 20 the Ministry of Finance, Ministry of Economic Development, Ministry of Energy and other agencies have offered the Prime Minister Mikhail Fradkov, a Russian exchange market of oil and oil products, which, according to experts, can co-exist with the market Urals in Budapest. The disadvantage of Russian oil is its low liquidity, since it depends on the port of delivery schedule. This may prevent it from becoming a model and get rid of the dependence of the cost of Brent.
If the Urals will still make reference variety, its price may be increased by $ 0.5.
