Energy Trading & Hedging : A Nontechnical Guide

This book focuses primarily on the energy products that are financially traded on the New York Mercantile Exchange: crude oil, natural gas, unleaded gasoline, and heating oil. These commodities are the most common ones used for hedging energy commodity risk. Each of these products has a profound effect on the United States and international economies. It discusses several of the factors that influence energy price direction, the financial instruments used in the market, and how commercial entities utilize these instruments to hedge the risks inherent in energy production and consumption, such as price and physical risk. It also addresses the use of energy financial derivatives strictly for profit (speculative trading) and the exchanges that make efficient and competitive trading possible. The physical cash market is addressed along with the major industry publications that produce market prices, known as postings or indexes. Additionally, the book briefly discusses technical analysis, using charts to identify price trends and predict directional changes. Finally, the book discusses the need for stringent controls on the trading of financial energy derivatives to avoid some of the more notorious pitfalls that have led to the collapse of major global companies and institutions.

Features and Benefits

• Supply / Demand Fundamentals
• Market overviews (financial and physical)
• Contracts
• Derivatives
• Technical Analysis
• Risk Controls

Audience

• Field level personnel
• Management
• Energy lending and finance professionals
• Anyone who seeks to understand how, or relies upon, energy markets
• Students

Tom Seng is an applied assistant professor of energy business and assistant director of the School of Energy at The University of Tulsa. His other teaching experience includes serving as an adjunct instructor for TU, the University of Oklahoma, Penn State University, and Texas Christian University.Seng has more than 30 years of experience in the natural gas and natural gas liquids industry, including physical and financial commodity trading, risk management and hedging, pipeline and midstream operations, transportation and storage capacity marketing, and risk control.He holds a bachelor’s degree from the State University of New York and an MBA in oil and gas management from Robert Gordon University, Aberdeen, Scotland.