ABSTRACT
The United States, which contributed about 70% of the world oil trade during the 1930s, was now reduced to insignificance as an exporting country and became a net importer as a result of phenomenal increases in domestic consumption. The formula for pricing bunker fuel was extended to apply to other refined products and crude oil in 1945. Since the distance of the Eastern seaboard of the United States was roughly the same from the US Gulf and the Caribbean, this system of pricing made the delivered prices of crude from these two regions equal at the Eastern seaboard. Under this new system of product pricing in the Eastern Hemisphere, all the markets to the east of Switzerland adopted Persian Gulf as the basing point, whereas for those to the west of Switzerland either US Gulf or Caribbean was adopted. In other markets the parity pricing system has come under severe pressure.
