Oil and Gas Downstream

Processing, transporting and selling refined products made from crude oil is the business of the downstream segment of the oil and gas industry.

Key downstream business sectors include:

The downstream industry provides thousands of products to end-user customers around the globe.

Many products are familiar such as gasoline, diesel, jet fuel, heating oil and asphalt for roads. Others are not as familiar such as lubricants, synthetic rubber, plastics, fertilizers and pesticides.

READ ABOUT THE DIFFERENCE BETWEEN UPSTREAM AND DOWNSTREAM

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Downstream Modules Include:

Refining

Refiners produce a wide range of fuels and specialty oils used in transportation, industry, electricity generation, heating, and petrochemical production, and in thousands of other uses.

These modern facilities, which cost billions of dollars to build and can incur billions of dollars in annual operating costs, employ a variety of technologies to squeeze the most out of a barrel of crude oil and to provide the flexibility required to meet shifting seasonal product demand patterns.

Introduction to Refining
Crude Oil and Petroleum Products
Refinery Processes
Refining Business Drivers
Refining Business Processes
Refining Trends

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Supply, Trading, and Transportation

Volatility and trading have always been an integral part of the oil business. Researchers point out that in 1859, crude oil was selling for $20/bbl and two years later oil prices were only 52 cents. Speculators would buy huge quantities of crude after an especially successful wildcat well had made the oil prices drop, store it in tanks and wait for the price to rise again.

JD Rockefeller realized that control of supply was the key to success in the business. His initial focus was “cooperation” (later named a monopoly) between refining, transportation and sales. By 1879, Standard Oil controlled 95% of oil refining in the US. He also purchased plants, warehouses, tanker cars and wagon fleets to make his company totally self-sufficient.

Managing supply logistics has been a global challenge from the industry beginnings.

Introduction to Supply, Trading and Transportation
Crude Oil and Product Fundamentals
Hedging and Financial Contracts
Supply and Trading Business Drivers
Supply and Trading Business Processes
Supply and Trading Trends

Marketing and Retail

Characteristics of the petroleum product marketplace vary widely from country to country, but since Ford began mass marketing the automobile in the early 20th century, the United States has been the leading indicator for petroleum product marketing concepts, pricing and formats for the rest of the world.

Accordingly, this Course focuses on marketing practices in the United States, with notes on alternative practices in other global markets as appropriate.

The marketing function covers petroleum products sold from storage terminals at refineries, pipelines and marketing terminals. The most widely known aspect of marketing around the world is the retail service station.