Commodities are not always produced close to where there is demand. Physical traders act as distributors, supplying clients and moving products around the world. Most of the world's oil is produced in the Middle East, whilst most of the demand is in Asia.
The balance between supply and demand in energy and commodity products can be affected by many factors. In the longer term, demand trends are driven by economic conditions, technological advances or changes in government policy.
In the short term, weather or political unrest can affect the balance between demand and supply, and leave commodities producers, processors or distributors with too much or not enough product.
In addition to long term supply arrangements with clients – ensuring industrial clients have a steady supply of product, they need to continue with the smooth day-to-day running of their operations – physical commodity trading firms seek to identify and address short term market imbalances.
At Singatra Pte. Ltd. we are building global connectivity between miners, refiners and end buyers: benefitting from economies of scale. We facilitate trading volumes by signing off-take agreements and developing downstream distribution thereby creating strategic alliances. We invest in channels that streamlines and simplify supply chains.
Petroleum is recovered mostly through oil drilling. This comes after the studies of structural geology, sedimentary basin analysis, reservoir characterization. It is refined and separated, most easily by boiling point, into a large number of consumer products, from gasoline (petrol) and kerosene to asphalt and chemical reagents used to make plastics and pharmaceuticals. Petroleum is used in manufacturing a wide variety of materials.
