The Singapore 92 Crack contract is a commodity CFD (Contract for Difference) in the Gasoline group that represents the price differential between Singapore Mogas 92 Unleaded and Brent 1st Line crude oil.
Contract Purpose
This product differential contract allows market participants to:
- Hedge exposure to the price spread between Singapore Mogas 92 Unleaded gasoline and Brent crude oil
- Speculate on refining margins for producing gasoline from crude oil
- Manage risk related to gasoline and crude oil price fluctuations across Asian and European markets
Market Significance
- Refining Margins: Reflects the economics of producing gasoline from crude oil in the Asian market
- Regional Arbitrage: Captures opportunities between Asian gasoline and global crude oil markets
- Benchmark Indicator: Serves as a key reference for gasoline pricing in relation to crude oil in the Asia-Pacific region
Trading Benefits
- Cross-Market Exposure: Provides simultaneous access to both Asian gasoline and global crude oil markets
- Risk Management: Allows hedging against price volatility in both gasoline and crude oil markets
- Spread Trading: Enables traders to capitalise on price differentials between refined products and crude oil
This contract is particularly valuable for refineries, trading houses, and financial institutions active in both the Asian gasoline and global crude oil markets. It offers a powerful tool for managing price risks and implementing sophisticated trading strategies that account for the relationship between gasoline and crude oil prices across different regions.