ABSTRACT
This chapter discusses two aspects of the structural change, which have altered international crude supply radically, but in rather contrary ways. First, it has greatly enlarged the arm's length crude market. Secondly, the main actors in this enlarged market are all largely new to trading in oil, and by nature are unlike all other traders. Although the volume of crude moving in inter-regional trade is about 40 percent lower than a decade ago, and OPEC exports have fallen by close on half, arm's length sales of crude have probably doubled in volume. The spot market for crude was not important, or at any rate was not regularly reported, before the late seventies. Such sales served a balancing function at the margin, to match integrated suppliers' crude availabilities with refiners' requirements and meet minor shifts in consumers' demand for products.
