Vaco Group Holdings is a company with the main aim of providing professional reliable service.
The company is currently operating in different lines of business with collaboration of it's branches in Asia, Europe, Africa and America.
Trading of crude oil, fuel oil,Gas Condensate, Gasoline, Gas, Naphtha (jp54-m100) and other oil and petroleum products is the main area of the company’s business.
Vaco Group Holdings expanded its business after taking over some of (International oil companies in Europe) I.O.E co and (oil and Gas trading companies) O.G.T co and 4 other countries through a London based investment company called ATS co.
Vaco Group Holdings is one of the world's major supplier of beef and have successfully expanded this business area the world. Our meat is transported in well-equipped ship.
We are the manufacturer of oil jetties، with all facilities and benefit from the best experts. we have manufactured and equipped over 19 oil port in the world. because of decreasing oil prices and the downturn in international oil markets, crude oil extraction in Many rich oil regions are faced with the problem of lack of economic justification.
Investment in oil projects is the other activities in Vaco Group Holdings and It is negotiating with other oil companies to invest in the extraction of oil from the bottom of the Arctic Ocean Petroleum Exporting Countries.
Hope the oil exporter countries end to sell more than their quota in world market till crude oil price could return to it's stability and the investment made in the oil indusry reaches to a suitable profitability.
our oil and petroleum products are transported in oil tankers with capacity of 45000-300000 MT (Metric Tons) in modern vessels to different parts of the world.
We supply oil and petroleum products as well as all the oil industry equipment.
We are proud to be the main business partner of the larges meat supplier in the world, Brazilian beef supplier B.O.E .
Vaco group was founded by John Cameron and two oil investment companies in 1980 that one of them was the shareholder of BP company which was founded in England and since 2000 and promoted into four oil companies that one of these companies worked in the field of building oil platforms.
In 2005 London stock market faced with a serious problem andPit Rangon of ATS holding that had four active oil companies, were sold to vaco group and it's ownership got exclusively for vaco group.
One the most important goals of vaco group is achieving more Opec market share.Althogh vaco group has 54% share of oil dealing in African countrieslike Nigeria,Egypy and Libia, it's looking for achieving the whole opec oil markets and consuming markets will reach to 15% of it's share of Opec oil package till 2022.Because nowadays the huge part of opec member's oil dealing is done by government.But all our attempts and goals is to attract more than 15% of Opec oil market every year.
The major shareholders of holding detritus are BP and the ATS companies, noted that BP by 8 percent and IT by 13 percent are the major shareholders of holding oil detritus and the remaining shares of the company belongs to its subsidiary companies which are all owned by Dr.Meghdad Bigdeloo. vaco Asian part is operating around Persian Gulf and East Asia, especially in Malaysia and China.
The most important supplying product of holding oil detritus are:crude oil and heavy fuel oil 380 and 280 and JP54 and gas condensate and gasoline and naphtha that most of the activities of holding oil detritus is about purchasing and selling crude oil and heavy crude oil and fuel oil.
BP petroleum company is a government company and England owns 59% of it's stock and most of it's shareholders are government oil companies which most of their activity is about extracting and producing crude oil.
ATS company is also an investment oil company that was founded in England and most of it's activity is about investing in oil projects and building and producing oil industry equipments.
Oil Price Fall Threatens US Oil Production By VACO GROUP HOLDINGS INC , 2014/11/04.
A falling oil price is good for the US consumer and good for the US economy. Transport costs feed into the price of every physical product, so if oil gets cheaper, everything gets cheaper. If the oil price falls too far, however, the USA's recent fracking boom will come to an end. Forces are at play to end the USA's projected energy independence and return the country to dependence on the Middle East for its fuel supplies. The USA's long-term key supplier, Saudi Arabia, doesn't want to lose grip on its best customer.
Recession
Falling factory output in China and the onset of recession in Europe means that a continued fall in the demand for crude oil is inevitable. The recent return to production of Algeria, Libya, Iraq and Iran means that the world is already oversupplied with crude oil. The astonishing rise of production by hydraulic fracturing in the USA means that America is increasingly self-sufficient in oil. When supply exceeds demand a fall in the price of any product is inevitable.
When a market is over supplied, prices continue falling until enough suppliers are forced into bankruptcy to reduce supply to the level of demand. At that point, prices can start to rise again. This is the classic explanation of the causes of recession and recovery. However, the oil market is different. Lead times and start up costs are high in the industry and so production cannot just be turned on and turned off at will. Oil has a global sales price but location-dependent variations in production costs. Middle eastern producers responded to the peculiarities of the oil economic cycle by forming OPEC to limit supply in times of economic decline and support the price of oil. By controlling supply levels and sharing out the cuts between them, the 12 nation club can ensure that none of the producers have to go bust before supply and demand return to equilibrium.
Return to Market
The recent return of production by Algeria and Libya put pressure on OPEC's oil quotas. Both these recovering countries are OPEC members and so their sudden return to the market means that the club now exceeds its self imposed limit of 30 million barrels per day. The inevitable fall in the price of crude oil, caused by over supply, should have sent the members to the conference table for an emergency quota-slashing meeting. However, key members of OPEC fell silent, and stuck to the planned meeting schedule, meaning the group will not meet until November to talk about limiting output.
OPEC has no power to impose its quotas and so if the member states do not want to abide by them, there is little anyone can do about it. The group's stated limit of 30 million barrels per day would still see the market in over supply. Any quota-busting production spells disaster for the price of crude oil.
Policy Change
Saudi Arabia is by far the largest producer in OPEC, although on a global scale, their output is exceeded by Russia. It has always been in Saudi Arabia's interests to keep the price of oil high. This is because, despite decades of wealth, the county hasn't managed to produce any other industry that could sustain the levels of state spending to which the country has grown accustomed. Saudi Arabia uses the threat of reduced production and high oil prices to give it a very power voice in world politics and it is particularly adept at co-opting American military might to its pet causes.
Suddenly, Saudi Arabia seems to have switched its policy. It increased its production in September 2014 and not only fails to support the current price but seems to be actively pricing its sales to drag the global price of oil down. The country is now selling at a price lower than the level it needs to maintain state spending. It is dipping into reserves to enable it to undercut its rivals. The OPEC alliance has split and old rivalries in the Middle East are driving the current fall in oil prices.
Hydraulic Fracturing
The techniques behind hydraulic fracturing have been around since the 1930s. However, refinement of the process and its application to shale in the late 1990s made the process a commercially viable method of oil extraction. As the technique developed and was combined with horizontal extraction methods, hydraulic fracturing, or "fracking" created exponential growth in US oil production. By 2010, the success of fracking had removed the need for the USA to import gas and US companies skilled in the technique began to spread across the world looking for earning opportunities in other countries. Large shale oil basins were discovered across the globe and US businesses looked set to reap the rewards of their expertise by dominating oil production by this technique.
Oil Price
In a perfect market, unhindered by politics, cartels or special interests, the price of a product is the only mediator between its demand and its supply. When demand for oil exceeds supply, its price rises, making extraction from inhospitable locations, like the Arctic tundra or offshore platforms, economically viable. More of the world's oil becomes profitable and so more is extract by extending production to previously unprofitable locations. Output rises to meet demand and the price stabilizes. If supply exceeds demand then the price falls. If the price falls far enough, and stays low long enough for those extractors in high-cost locations to go bust, excess production will be squeezed out of the market and the price will rise again.
The expansion of fracking in the United States has contributed to over-supply. Fracking is only viable at a certain oil price level, so, in many ways, by forcing over-production, hydraulic fracturing oil producers have contributed to their own problems. Investments were made in low-margin extraction and loans were secured to finance them, based on the convention that no matter how much oil the US produced, price levels would be maintained by OPEC cutting production. Financiers did not have to worry about the dangers of supply and demand because OPEC would ensure price stability.
New Normal
Saudi Arabia has put its foot down. In the face of triumphalist crowing about energy independence in North America the country has turned to the classic economic model of price being determined by the equilibrium between supply and demand. Not only are they not reducing their prices, they are actually cutting them. They are not lowering production levels, they are increasing them. The Kingdom has large cash reserves and they seem to be prepared to coast on their savings for as long as it takes for their competitors to go out of business. Fracking is vulnerable and will not survive a price drop unless the US oil industry reorganizes.
Challenges
Thanks to financing costs, new hydraulic fracturing sites are unlikely to be opened up if oil stays at less than $90 per barrel for any length of time. Each extraction project is different and incurs different plant investment costs, returning different profit margins. The banking industry, however, works on a blanket level of a need for $80 per barrel for a project to turn a profit. The extra $10 is needed to ensure the banks get paid back.
However, some shale oil regions, such as the Eagle Ford Shale and Permian Basin in Texas can still turn a profit selling at $53 per barrel. The problems faced when assessing any new shale oil project include distance to distribution points, local availability of accommodation, the capacity of the transport network and availability and price of expertise and staff. These factors can make crude oil cheaper to deliver from Texas or North Dakota to refineries on the East Coast, or it can make Saudi oil, arriving by tanker, cheaper than domestically produced oil.
Solution
Hydraulic fracturing became a viable business in the US because of a rising oil price and also because of falling production costs. Necessity is the mother of invention and it should not be assumed that the industry will not continue to develop cheaper methods and equipment. The shale oil producers have been living high on the hog with a gold rush mentality, spraying cash in all the communities into which they move. Therefore, there is a lot of fat to trim to bring inception and operation costs down. High payments to property owners for drilling access are probably soon to be dramatically reduced, building schools and community facilities are expensive public relations exercise that may not happen again.
Supported by technology and aggressive cost cutting, the US shale extraction oil producers can continue to expand their share of the market. Pipeline projects to distribute domestic oil to US refineries would lower delivery costs and further reduce the price disadvantages of shale oil. US producers need to be smart and act quickly, however, the Saudi Arabia Oil Policies and Strategic Expectations Center recently revealed that the Kingdom is prepared to go as low as $50 per barrel, which would be a tough price to match.
Who benefits from lower oil prices? By VACO GROUP HOLDINGS INC, 2015/09/02
Lower fuel prices are great for the consumer, but we know that not all of the cost saving of lower crude oil and gas prices have been passed on to the general public. Oil and gas refiners prosper from lower oil prices. Like the rest of the oil industry, refiners' revenues are down, but their profit margins are up significantly.
Refiners are using lower crude prices to widen their cut of the pump price of oil. In other words, the lower price of oil is not entirely passed down to consumers at the pump, instead the difference is enabling refiners to increase their profits.
Price Falls
Crude oil prices have been plummeting since June 2014. The initial fall was rapid and unexpected. This was because production grew faster than projections and demand deteriorated faster than expected, resulting in an excess of oil for sale in the world. Periodic rumor-fuelled rallies in the market since June 2014 have proved to be the result of wishful thinking. Recent events, such as the fall in Chinese growth projections and the end of sanctions against Iran, have given economists reason to downgrade their expectations for crude oil prices.
The lurches in the consensus of opinion for demand for oil over the past year have caused temporary opportunities for price rises at the gas pump. The retail gas industry tends to raise prices quickly when crude prices rise and drop prices slowly when crude prices fall. This variable speed of price movements has given the refineries and the gas stations opportunities to extend their profit margins.
The fall in the price of crude oil from June 2014 to June 2015 was around $80 per barrel. This shaved $1.60 off the cost of a gallon of gasoline. However, the pump price only fell by $1.20 during that period.
The Losers
High prices for crude oil from 2010 to 2014 gave great incentives to US explorers to invest in locating new sources of oil and gas. The practice of hydraulic fracturing rapidly expanded the USA's oil production and contributed to the current glut. High sales prices meant that fracking companies could bowl into town, rich with easy money. They sprayed money around the communities they moved into and offered high prices for mineral rights and site access. Those gold rush bonanza days ended in June 2014. The price fall in crude oil did not squeeze frackers out of business, they caused them to be a lot more careful with their money.
Frackers learned to extract more oil from each rig, thus reducing the start up overhead costs of each well. The increased tightness of financing meant the idea of spending millions to get access and buy friends was off the table. A lot of the largesse of fracking has been wiped off the books and so local communities in the vicinity of fracking plays benefit a lot less from a new well, than those lucky citizens reaped back in 2012 and 2013.
Fewer rigs mean fewer workers. It also means that less equipment needs to be sold. Thus, oil service companies make fewer sales, and also require fewer employees to maintain their reduced output. Employment in the oil industry has suffered as plans get put off and exploration is cut back. As examples of this phenomenon, consider Schlumberger, which is the largest oilfield service company in the world. Schlumberger has cut its workforce by 9,000 this year. Weatherford International cut their payroll from 60,000 staff to 46,000 in 2014 and then made a further 5,000 employees redundant in 2015.
By squeezing margins and employing new technology, US frackers have been able to stay in the game. Their success at maintaining profitability at lower market prices has put pressure on conventional producers around the world to reduce profits and slash costs. So, although no producers have gone bust yet, their drive to survive has returned a lot of oil workers to the employment lines.
Unemployment reduces the wages of employed oil workers, because there are plenty of other who would fill the shoes of specialists who walk off site rather than reducing their fees. Thus, the oil industry's workforce has become a major loser in the low crude price era.
Middle Eastern OPEC members are said to be driving the price fall in order to squeeze out their fracking rivals. This strategy has lost those governments the income they need to keep their economies running with very little alternative sources of income. They must now subsidize their governments with their foreign currency reserves. Drawing down bank deposits means there is less money available for banks to lend, thus squeezing credit and reducing global economic expansion further.
As Arabian governments start to draw down their savings, they will be forced to cut government spending. Oil producers in the Middle East buy off their citizens' ambitions for democracy with petrodollars. Of course when the money runs out, instability will increase even further in those countries.
The Winners
The recorded fall in the gas pump price of $1.20 per gallon is a definite benefit to the American consumer. Under normal circumstances, economists would expect this saving to boost spending on consumer goods. However, this time around, people don't seem to be spending their gas savings on buying larger gas guzzling vehicles. This may be because the trend towards energy efficiency is finally starting to lodge in the American psyche. Recent memory of economic uncertainty also seems to have made the average American nervous about spending.
An increasing fraction of American consumers has decided to pocket that saving and pay down debt, rather than splurging on household gadgets or luxury vacations. Therefore, families will also be long-term winners from the crude price fall. Parents now rate financial security over comfort spending.
By far, refiners have been the biggest winners of the crude oil price downturn. This position is reflected in the stock valuations of refining companies. The stock price of the refiners, Valero Energy went from $43.76 per share in November 2014 to $70.43 in August 2015. This rise was mainly due to the company's surge in profits. In June 2014 the business reported a profit margin of 1.68 per cent. By June 2015, that figure had risen to 5.38 per cent. Refiner Tesoro Corporation has risen in value from $56.20 in June 2014 to $102.08 in August 2015.
As an illustration of the increased margins the refiners experienced, figures from Total S.A. show a margin of $3.75 per barrel in the final quarter of that year. Profitability took off through 2015 and the company reported its refining margins at $6.73 in the first quarter and $7.36 in the second quarter.
The oil price fall was a symptom of an excess of production. As wells kept pumping oil into a saturated market, stockholdings rose. This resulted in a shortage of storage capacity, and so the price of storage rocketed. Storage fees rose from 20 cents per barrel to 80 cents by March 2015. The shares in Vopak NV, an oil storage provider, rose by 33 per cent between August 2014 and April 2015. Kinder Morgan rose by a similar margin and rival storage companies also rose in value over the same period.
Is this Profiteering?
There are laws in place to protect against profiteering. These laws prevent gas stations from overcharging for gas during crises and natural disasters, such as tornadoes. Shouldn't they be applied? By definition, a business can be accused of profiteering when it raises prices during awar or emergency. Although the current oil price is a matter of global economic importance, it cannot be defined as a crisis or an emergency.
In fact the pump price for gasoline is slightly cheaper than it used to be a year ago so the prices were not even raised. This is called capitalism, not profiteering and is central to a free market economy. This is the American way. If you too want to benefit from this situation you can -- buy refiner or oil storage stocks.
Logistics
Profit derives from the gap between what it costs to produce something and what someone is prepared to pay for that product. No one considers himself a charlatan if he sells his home for more than he paid for it. That profit probably came from nothing more than the increase in the amount that buyers were prepared to pay and not from any decoration or maintenance work performed by the seller.
Demand for gasoline is inelastic, but supply levels can vary widely. Shortages of crude oil cause the price of crude oil to rise and excess production causes the price to fall. Thus, in the current market, refineries can force the price of their raw materials down and they do not lose sales by maintaining sale price levels. The crude oil market is currently in oversupply, but the automotive user can't profit fully from that price-depressing factor, because they can't pump crude oil into their vehicles. This is the classic formula for profit.
The intermediary sectors of the oil industry - transport refining and tanking - usually profit most during a crude oil price downturn. This is a common pattern noted by economists. As the gatekeepers to the consumer market, this sector gains power when producers need to compete to sell, and thus they are able to force down their input costs.
Logistics companies usually integrate the functions of refining, transport and storage, because that gives them a win-win situation. Producers that are prepared to drop their prices will sell their output to the refiners, who then have lower costs. Those that hold out for better prices need storage, thus the tanking divisions of the logistics companies can raise their prices thanks to excess demand for their services.
Oil production is slow to turn around. An oil well takes years to plan and established shipping agreements are hard to break. Over time, producers will reduce their output and put more effort into finding other regions in the world where they can send their crude oil. These activities will eventually bring supply and demand for crude oil back into equilibrium.
Although demand for gasoline is fairly fixed, long-term changes in the fuel market will eventually have an effect there too. The cost of different types of fuel is a major factor when families and businesses decide to purchase vehicles and heating systems. An enduring lower oil price will eventually increase demand for the product as furnaces, trucks, buses and cars get replaced. Higher demand for gasoline puts pressure on logistics companies to source more crude oil, which returns some power to the crude oil producers and reduces the negotiating power of refineries. Similarly, when demand rises against falling availability, the need for storage falls and logistics companies have to start pricing their services competitively in order to maintain throughput in their high-cost facilities.
The share prices of tanking giants Vopak NV and Kinder Morgan peaked in April 2015 and then started to fall. The excess profits to be made from storage already seem to be petering out. The end of the imbalance in the oil sector seems to be within view for stock investors, so margin gains of the logistics companies will now start to decline.
Conclusion
Different oil price conditions generate larger profits at different points in the supply chain. This year, and for at least another year to come, the processors, transporters and retailers have their turn to ramp up their share of the sales price. In other years, oil brokers make all the money and at other times oil producers can name their price. No matter which particular stakeholder has a periodic opportunity to profit, there is one organization that will always profit from crude oil and gasoline - the government.
Vaco Holding
