Growth has occurred and at the St. Petersburg international Mercantile exchange (SPIMEX): despite the isolation, the average daily turnover of various fuels rose in may, increased the supply of summer diesel and kerosene. Not without speculation: several traders wanted to use prior to falling prices in their favor.
How they do the exchange, are the ground spikes in food prices in the summer, as well as on the prospects of Russian oil supplies, “the Russian newspaper” said SPIMEX President Alexey Rybnikov.
In mid-may, the gasoline market started to recover. However, still reduced stocks, though a reserve “cushion” in the factories and accumulated. Whether in these circumstances, the company regularly to sell fuel on the stock exchange?
Alexey Rybnikov: Despite the reduction in fuel consumption in the country in the fight against COVID-19, we have the implementation is not decreased by very much, and in some petroleum products, on the contrary, there is excess in comparison with the previous year. The average daily turnover in the oil market on the stock exchange in April decreased by only 2% compared to April 2019, and may even increased by 4% (as of may 25).
of Course, most seriously in the country dropped the demand for gasoline and diesel. But through the exchange, as practice shows, and indicated by numbers, you can find a buyer.
trading Volumes for gasoline Regular-92 over the past period may, at the exchange has decreased by 11% to 224 of 450 tons, the volume up 95 gasoline fell by 18% – to 118 175 tons, despite the fact that, according to various estimates, the country as a whole the demand was about 30%.
e-Exchange platform works remotely, which is useful in conditions of isolation, when almost all large companies moved employees to “udalenka”. It helps smoothly to ensure economy and population oil.
Very indicative in this respect the example of summer diesel, where we have marked a serious growth of sales in may, 18%, and jet fuel 61%.
up To 30 June de-facto reduced the ratio of sales on the exchange. How it was a necessary measure and will not need to renew it?
Alexey Rybnikov: the Ratio of stock sales is insurance for oil companies from measures of Antimonopoly response. Temporarily reducing the ratio of the state shows the border of its tolerance on the subject. However, the task of providing the internal market with oil products and the formation of a representative price has not been removed. Regulators are closely watching the trading volume on the exchange and are clearly responding to price signals.
We see that companies are still, in spite of a decrease, actively sell fuel on the stock exchange and the dramatic fall in supply.
Over the past two years, after the jump wholesale, and then retail prices oil in 2018, on the stock exchange has tightened the rules of the auction. How was it effective?
Alexey Rybnikov: We, together with the Bank of Russia, Federal Antimonopoly service and the government has increased the requirements for bidders and imposed penalties for failure to exchange contracts. This allowed to discipline bidders: we conducted inspections and applied certain sanctions in the last period.
In April and early may of this year we began to record that in the conditions of falling prices, some bidders felt it was more profitable to pay the penalty, but not to execute the exchange agreements. The question was debated in the Council of the section of “Oil products”, and on his recommendation we will make to infringers measures up to disconnection from the auction.
the whole essence of our policy was that the price was dictating the balance of supply and demand, and the bidders, there was no doubt as to this mechanism, so any attempt of manipulation, and dishonest behavior are suppressed.
If the second half of the summer will mark the exit of self-isolation, demand for oil products clearly increase. The exchange is ready to a jump in prices?
Alexey Rybnikov: FAS and the Ministry of energy are closely monitoring this, and our task is to counteract the attempts of speculative pricing. We have a wide range of measures: restriction of price movements within established corridors, control of execution of exchange contracts, the Bank of Russia helps to deter market manipulation and so on. I guess it won’t be a problem.
After the extreme fall in the price of crude oil on the stock exchange in Chicago in April, how would you rate the pricing system on the world market? Minus 40 dollars per barrel – it was a market price or not?
Alexey Rybnikov: Think that the events on the Chicago stock exchange is an example of market pricing. What happened to the “paper” (financial) market, was the result of the situation in the physical market oil reservoirs were overflowing, and the oil under the exchange contract, there was nowhere to put it. If this is not possible, then the punter is willing to pay to get rid of this volume of oil.
From buyers exchange contracts – financial players, it looked like losses. But there are companies that conduct operations not only on financial market but on the market of real goods. They had free storage containers, and so they got the oil not even for free, with additional income for yourself. This is the market: someone lost, someone gained. This illustrates the significance of the physical market infrastructure, as well as places of the market of real goods in the pricing system.
How are things going with the implementation of Urals through the exchange? Deliverable futures contract for three years I gathered the necessary liquidity and took off. What’s next?
Alexey Rybnikov: We did not set the task to organize the implementation of oil through the stock exchange. The exchange is primarily a tool of pricing. On the global oil market price formation occurs through a complex system of interaction between physical and financial markets. On the stock market are turning the delivery and settlement of contracts for oil, as an important element (but only one element) the pricing system. Our supply contract for Russian export of oil Urals has given the market it tools. At the stage of its establishment, we consulted extensively with oil companies, therefore, the design of our contract – is the General solution of the market. Incidentally, it is interesting that over the past period, all new oil contracts on foreign exchanges – that is deliverable (Chinese contract on the Shanghai stock exchange, the new contract on the stock exchange in the UAE).
As shown, the tool deliverable futures market was difficult. However, initially it was clear that it was not consistent with the current practice of the Russian oil companies that now sell oil at a price formula linked to a variety of world petroleum measurement standards.
the Abyss failed to jump in one leap. So you have to take a more long workaround. We are developing a system of electronic auctions and tenders for the supply of oil for export, which will allow over time to form a single quotation of Russian oil exports. And on its base over time, you have to try to develop the design and delivery of exchange contracts.
Now, in terms of remote work companies, it is difficult to reorganize business processes, and even at the same time to change the habits of the organization of trade in exports, which operate for decades, so while moving more slowly than I would like.
last year, the exchange launched deliverable futures contract on export of diesel. With its liquidity problems there?
Alexey Rybnikov: Recently, over the treatment of futures in June 2020, which through the exchange will deliver three tankers with diesel engine for export. This means that the company gradually this tool to learn and use them in their trading practice.
