# Endur converting between different Units for Financial Oil Products

## Overview

### Different Units for Financial Oil Trading

Different products get traded in different units. Very roughly:

 Product group Trades in CCY/Unit Unit Type Crude \$ / Barrels Volume Clean [US] cents / Gallons Volume GO / Diesel \$ / Ton Weight FO [US] \$ / Barrels Volume FO [Europe / Asia] \$ / Ton Weight

### Trading Crack / Basis swaps and options

When trading cracks / basis spreads between different oil products it’s often required to trade them on a common unit (depending on market convention). This requires that on the deal that Endur can convert from the product unit to the deal unit. For this there are two types of conversion required.

## Unit Conversion between Volumes: BBL / GALLONS

This is a standard conversion:

 1 Barrel = 42 Gallons

## Unit Conversion between Volume and Weight:

Any conversion between a Volume and a Weight requires knowledge of the density of the product. The definition of density is = Mass / Volume.

• In Endur this density is recorded on the Index Definition under the Density Adjustment field.
• The Endur (price) Density Adjustment = 1 / Density .

### Setting the MT<->BBL conversion factor to 1

 In the Admin Mgr Unit Conversion module, set the conversionMT <> BBL to = 1Which will ensure Endur uses the pure Density Adjustment value (otherwise it will additionally adjust by whatever value is entered here)

### Unit Conversion Calculation ( on deal )

Once the density adjustment is on the curve, Endur can convert from Volume <-> Weight in order to book a Crack / Basis spread deal where a common unit across two different Volume/Weight units is required.

Sometimes it’s the Price/Unit that needs converting and sometimes it’s the Unit. Both conversions are done as follows:

Endur obtains the Density Adjustment from the curve.

### Example Density Values

#### Example calculation of Density and Density Adjustment

The following is an example calculation of the density and density adjustment of Jet Fuel.

## Other people's views

1. Client J says:

OIL
Crude (WTI / Brent ) is in BBL {volume}
Products ( GO / FO â€¦.) is in MT {mass}

BBL

A Barrel contains = 42 US Gallons {volume}
= 158.987 Litres {volume}

{A Barrel of Crude will typically get broken into 25 US Gallons of Gasoline and Rest as Jet Fuel / Heating Oil etc }

Water

1 MT {mass} of Water = 1,000 Kg {mass}
= 1,000 Litres {Volume}

OIL PRODUCT CONVERSION

A Barrel {volume} = 42 US Gallons {volume}
= 158.987 Litres {volume}
= 158.987 Kg {mass} of WATER ( as 1 Kg of water = 1 Litre volume)

Or equivalently

1 MT {mass} of Water = ( 1 / 158.987 ) = 6.29 BBL {volume}

So we now have a way to convert from a Volume to Mass of water in relationship to a BBL.

Key to this is fact that for WATER the Density = 1