The Oil Info Cartel Is (Finally) Broken
A determined James Stafford of OilPrice.com just busted huge open an oil industry information cartel that has existed for decades.
Most traders have a look at WTI and Brent prices at Bloomberg or CME Futures, and figure the oil price is in the public area. You would be about 2 p.c appropriate, because there are lots of of different grades of oil, and hubs where it’s bought and sold. And all of them have completely different prices.
For the reason that age of oil began until a number of months in the past, most real time oil prices had been jealously guarded by entrepreneurs, who used it to their benefit within the every day multi-billion greenback physical oil commerce.
But I’m going to inform you the story of how Stafford and his small group made 18 months of calls, cajoling and in the end paying for an incredible service you now get Without spending a dime. It’s a true chlorine factory David vs. Goliath story. And identical to in the Bible, the little guy gained.
What they’ve assembled so far is remarkable, and free. You can entry it through the link under:
That is an unbelievable and unprecedented collection of knowledge accessible for the public.
Stafford says that the feedback he has acquired has been distinctive. With no advertising effort the oil price web page is already receiving 40,000 visits every day.
It was an 18 month quest to democratize the world of oil pricing and bust the data cartel that has existed for decades.
A Simple Question – With No Simple Answer
Stafford’s quest started well over a year ago when he obtained a telephone call from a reporter working for the Wall Avenue Journal. The journalist needed help discovering a simple piece of information.
He was writing an article in regards to the African oil industry and simply needed to know the current price for Bonny Mild crude oil (the principle benchmark worth for Nigerian crude).
Now remember, it is a Wall Avenue Journal author with entry to an unbelievable community of contacts and analysis. This was not a casual retail investor sitting at dwelling with pedestrian internet search abilities and no trade contacts. You’d count on that discovering the current worth for Africa’s principal brand of crude for a Wall Avenue Journal writer can be a simple internet search or phone call away.
You would be unsuitable.
The Wall Avenue Journal author not solely couldn’t discover the current price for Bonny Light however the perfect he may do was get a price from six months in the past!
We were passing info around faster with the Pony Specific a hundred and fifty years in the past.
The difficulty that the Wall Road Journal writer was having surprised Stafford, who then realized that he too couldn’t get access to the present price of Bonny Gentle.
Because the founding father of the extremely popular website OilPrice.com, not being able to discover a price for a globally necessary kind of crude did not sit nicely with him.
So he put his head down and got to work.
Information Held Hostage – The Ransom…
$30,000 Per Yr
The web has made data available to everyone…..with ease.
Nowhere is that more true than in the investment world. I can faucet into any SEC filing of any firm inside seconds. It wasn’t that way back that I would have had to request that information by phone and wait to receive it by mail.
The web has sent the encyclopedia the best way of the dodo fowl, ruined many a neighborhood newspaper and made the coal gasification research world a a lot smaller place.
It has additionally levelled the playing subject in many cases, especially in the case of investing.
On the subject of acquiring international oil price information nonetheless the internet has carried out nothing. We’re nonetheless fully at nighttime.
Your first inclination may be to disagree with me. You recognize you can faucet into the present (or historic) price of West Texas Intermediate or Brent crude any time you want.
What you are missing is that those are just two oil benchmarks out of hundreds — 1000’s seemingly.
Typically individuals believe that oil is a single utterly indistinguishable, homogenous substance. A barrel of oil is a barrel of oil is a barrel of oil.
That isn’t the case.
In its pure unrefined state crude oil differs in consistency and density from very skinny, risky and mild oil to very thick, virtually strong heavy oil. It also differs in colour with all kinds of shades from pitch black to a light golden yellow.
Each place where oil is found has very unique properties coal gasification research on the subject of volatility, viscosity and toxicity.
In Canada alone there are north of seventy totally different oil blends. You read that correctly….I mentioned seventy!
(Click on to enlarge)
Figuring out the precise mix is crucial for the refinery process which has to account for the exact chemical and viscosity of the oil being processed.
Stafford knew that if couldn’t discover pricing for a significant type of crude like Bonny mild that there were numerous others that can be even onerous to get.
His quest quickly led him to a discovery. The only place to obtain a reasonably complete set of current oil worth knowledge required a subscription—of $30,000 to $50,000 per year.
These sources knew they’d the higher hand over individuals who had to have that knowledge, and so they exploited it.
Even that costly cost the oil price info wasn’t full. It concerned receiving only an end of day value for the various source of crudes – nothing actual time.
This just motivated Stafford more. His focus now was on discovering a solution to open up the world of oil prices, to make the data obtainable to everybody.
But it surely wasn’t simple, and it definitely wasn’t cheap.
It took Stafford and his workforce nearly 18 months of making phone calls, getting rejected, making extra cellphone calls – again and again.
When he found the correct folks they have been often reluctant to launch the knowledge for worry of ruffling the feathers of senior management.
Stafford in the end succeeded simply by knocking on enough doorways across the globe to seek out sufficient oil industry individuals who have been sick and tired of this oil price data being held hostage. Like Stafford these were individuals who felt that there needs to be transparency with respect to this information.
Stafford can be out of pocket by a couple of hundred thousand dollars per yr in an effort to safe the continued contractual commitments to supply this information.
The End result – World Oil Price Information
For everybody (Finally)
Stafford and his crew coal aren’t finished. They’re still making calls, sending e-mails and adding different blends to their pricing record. There are just a few blends that he is aware of they are nonetheless lacking however are unbelievable laborious to get ahold of. Certain coal gasification research OPEC blends specifically have been hard to pin down.