Feature
Playing power games
Thanks to increasing consolidation, it seems the country-specific energy exchange will soon be a thing of the past in Europe. But is this level of competition premature?
The right of refusal
Traders have learned that giving away free financial options can be costly. However, free options can take many forms. Brett Humphreys and Tamara Weinert discuss the value of a risk management option that can easily be given away
How long will the shopping spree last?
China appears set on a programme of foreign energy asset acquisition. Maria Kielmas looks into the implications for the energy industry
Carbon complexities
The EU ETS adds price complexity to European energy markets and the trend towards pan-European markets means far more complex models will be needed to model carbon risk, writes Bjorn Brochmann
UKPX to launch carbon spot contract on Climex
London-based energy exchange UKPX will co-operate with Dutch emissions exchange New Values to launch a UKPX spot contract for carbon emissions certificates.
Decisions, decisions
Where next for the price of a barrel of oil? It’s an important question for producers and consumers, for whom managing oil price risk has never been more crucial. Oliver Holtaway finds that the answer to that question is not necessarily ‘up’.
Marginal improvements
Despite reduced production in the wake of hurricane Katrina, no new US refineries are in the pipeline. Instead, refiners are operating at full tilt as they come under pressure to expand capacity. By Catherine Lacoursiere
Don’t blame Opec
As well as urging Opec to open up international access to its reserves, politicians in large oil-consuming nations should be encouraging investment in new refinery capacity, writes David Hufton
The cream of the crop
The employment market for oil and energy traders has been from one extreme to the other in a short space of time – especially in oil. Andy Webb looks at where the recruitment market is headed next
The cream of the crop
The employment market for oil and energy traders has been from one extreme to the other in a short space of time – especially in oil. Andy Webb looks at where the recruitment market is headed next
The risks of E&P
After two years of soaring oil prices, oil majors are still building low oil-price forecasts into future investment plans. Is this sound risk management, or are they being too risk averse? By Stella Farrington
Buyer and seller beware
As a busy M&A period looms in the US utility sector, a wave of power plant sales seems likely. But those looking to hedge the fuel supply to these assets will find it tricky, given the current volatile gas prices. By Joe Marsh
Shelter from the storm
Energy companies are showing increased interest in hurricane derivatives, a specialist product that can provide an additional layer of protection on top of insurance. Joe Marsh reports
Doctor’s orders
Should you try to hedge a physical asset by simply selling its expected output? Neil Palmer shows how, in some scenarios, either under- or over-hedging could make more sense
A glimpse of freedom
Merger and acquisition activity in the US utility sector, previously kept in check by the Public Utility Holding Company Act, could be set to swell with the repeal of this act in February, some analysts believe. By Oliver Holtaway
The hedging effect
The effect of hedging on a project’s net present value can be difficult to determine. Brett Humphreys shows how different types of hedging affect the distribution and the expected return of a project
Finance and faith
Islamic shari’a law may prohibit interest, but far from discouraging investment, shari’a-compliant structured project finance looks set to grow – particularly in the energy arena, as Maria Kielmas reports
Taking the screen test
Screen trading is spreading faster than ever in the energy markets and market dynamics are changing as a result. Do interdealer brokers in the market see this advance as a threat or an opportunity? Stella Farrington finds out
Raising the standard
Growth in energy trading has led to a need for better standardisation of contracts and integration of exchanges and trading hubs. But more needs to be done to simplify and streamline the trading process, says Wolfgang Ferse
Exceptions to the rule
Norwegian independent power portfolio managers are concerned that an impending EU directive may split the country’s power market and put them at a disadvantage. Oliver Holtaway reports from Oslo
Trading routes open
The coal and dry bulk shipping markets are tightly intertwined and the strong influence of each on the other provides some interesting arbitrage opportunities, which are starting to draw wider attention, writes Barry Parker
King coal still fired up
Despite the soaring cost of emissions reduction credits, the EU emissions trading scheme has yet to dampen utilities’ demand for coal. But, finds Oliver Holtaway, it may affect their long-term investment decisions
No sign of a slowdown
The fundamental outlook for coal looks price supportive for some years to come, but with other fuel prices sky high, coal looks set to retain its market share of electricity generation this decade. Stella Farrington reports