| Key Terms |
Definition |
| Contract 1 |
A futures contract specifying the earliest delivery date.
For gasoline, heating oil, and propane each contract expires on the last business day of the month
preceding the delivery month. Thus, the delivery month for Contract 1 is the calendar month
following the trade date.
For crude oil, each contract expires on the third business day prior to the 25th calendar
day of the month preceding the delivery month. If the 25th calendar day of the month is a
non-business day, trading ceases on the third business day prior to the business day preceding
the 25th calendar day. After a contract expires, Contract 1 for the remainder of that calendar
month is the second following month.
|
| Contract 2-4 |
Represent the successive delivery months following Contract 1.
|
| Crude Oil |
A mixture of hydrocarbons that exists in liquid phase in natural underground
reservoirs and remains liquid at atmospheric pressure after passing through
surface separating facilities. Depending upon the characteristics of the crude
stream, it may also include:
Small amounts of hydrocarbons that exist in gaseous phase in natural
underground reservoirs but are liquid at atmospheric pressure after being
recovered from oil well (casinghead) gas in lease separators and are subsequently
commingled with the crude stream without being separately measured. Lease
condensate recovered as a liquid from natural gas wells in lease or field
separation facilities and later mixed into the crude stream is also included;
Small amounts of nonhydrocarbons produced with the oil, such as sulfur and
various metals;
Drip gases, and liquid hydrocarbons produced from tar sands, oil sands,
gilsonite, and oil shale.
Liquids produced at natural gas processing plants are excluded. Crude oil is refined to produce
a wide array of petroleum products, including heating oils; gasoline, diesel and jet fuels;
lubricants; asphalt; ethane, propane, and butane; and many other products used for their
energy or chemical content.
|
| Futures Price |
The price quoted for delivering a specified quantity of a commodity at a specified time and
place in the future.
|
| Light, Sweet Crude Oil, Cushing, Oklahoma |
Specific domestic crudes with 0.42% sulfur by weight or less, not less than 37° API gravity nor
more than 42° API gravity. The following domestic crude streams are deliverable: West Texas
Intermediate, Low Sweet Mix, New Mexican Sweet, North Texas Sweet, Oklahoma Sweet, South Texas Sweet.
In addition, specific foreign crudes of not less than 34° API nor more than 42° API. The following
foreign streams are deliverable: U.K. Brent and Forties, and Norwegian Oseberg Blend, for which the
seller shall receive a 30¢-per-barrel discount below the final settlement price; Nigerian Bonny
Light and Colombian Cusiana are delivered at 15¢ premiums; and Nigerian Qua Iboe is delivered
at a 5¢ premium.
|
| Oxygenates |
Substances which, when added to gasoline, increase the amount of oxygen in that gasoline blend.
Ethanol, Methyl Tertiary Butyl Ether (MTBE), Ethyl Tertiary Butyl Ether (ETBE), and methanol
are common oxygenates.
Fuel Ethanol: Blends of up to 10 percent by volume anhydrous ethanol (200 proof) (commonly referred to as the
"gasohol waiver").
Methanol: Blends of methanol and gasoline-grade tertiary butyl alcohol (GTBA) such that the total oxygen content
does not exceed 3.5 percent by weight and the ratio of methanol to GTBA is less than or equal to 1. It is also
specified that this blended fuel must meet ASTM volatility specifications (commonly referred to as the "ARCO"
waiver).
Blends of up to 5.0 percent by volume methanol with a minimum of 2.5 percent by volume cosolvent alcohols having a carbon number of 4 or less (i.e., ethanol, propanol, butanol, and/or GTBA). The total oxygen must not exceed 3.7 percent by weight, and the blend must meet ASTM volatility specifications as well as phase separation and alcohol purity specifications (commonly referred to as the "DuPont" waiver).
MTBE (Methyl tertiary butyl ether): Blends up to 15.0 percent by volume MTBE which must meet the ASTM D4814
specifications. Blenders must take precautions that the blends are not used as base gasolines for other
oxygenated blends (commonly referred to as the "Sun" waiver).
|
| Propane (C3H8) |
A normally gaseous straight-chain hydrocarbon. It is a colorless paraffinic gas that boils at a
temperature of -43.67 degrees Fahrenheit. It is extracted from natural gas or refinery gas streams.
It includes all products designated in ASTM Specification D1835 and Gas Processors Association
Specifications for commercial propane and HD-05 propane. For price data, it does not include
the propane portion of any natural gas liquids (NGL) mixes; i.e., butane-propane and ethane-propane
mix.
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| Mont Belvieu |
The location specified in either spot or futures contracts for delivery of propane in
Mont Belvieu, Texas.
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| New York Harbor |
The location specified in either spot or futures contracts for delivery of a product
in New York Harbor.
|
| No. 2 Heating Oil |
A distillate fuel oil for use in atomizing type burners for domestic heating or for use
medium capacity commercial-industrial burner units, with distillation temperatures between
540-640 degrees Fahrenheit at the 90-percent recovery point; and the kinematic viscosities
between 1.9-3.4 centistokes at 100 degrees Fahrenheit as defined in ASTM Specification D396-92.
|
| RBOB |
"Reformulated Gasoline Blendstock for Oxygenate Blending" is motor gasoline blending components
intended for blending with oxygenates to produce finished reformulated gasoline.
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| Reformulated Gasoline |
Finished motor gasoline formulated for use in motor vehicles, the composition and properties of
which meet the requirements of the reformulated gasoline regulations promulgated by the U.S.
Environmental Protection Agency under Section 211(k) of the Clean Air Act.
Note: This category includes oxygenated fuels program reformulated gasoline (OPRG)
but excludes reformulated gasoline blendstock for oxygenate blending (RBOB).
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| Regular Gasoline |
Gasoline having an antiknock index (average of the research octane rating and the motor octane
number) greater than or equal to 85 and less than 88. Note: Octane requirements may vary by altitude.
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Definitions