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Gas

Quant ideas: Do we need realistic models?

It is often assumed that realistic models are a prerequisite for successful risk management, but this is not necessarily true. While using any model blindly can be extremely dangerous, simple Black-Scholes or Ornstein-Uhlenbeck models are more than…

Oil collapse fails to dent zeal for hub-based gas pricing

In recent years, European buyers of natural gas have pushed strongly in favour of contract pricing based on the continent's gas hubs, rather than more traditional formulas linked to the price of oil. Given the huge drop in crude prices, has this stance…

European gas hubs stand to benefit from crisis in Ukraine

Escalating tensions between Russia and the West over Ukraine have taken energy market participants by surprise. With the potential for tougher sanctions, industry observers believe one outcome could be an acceleration of Europe's shift away from oil…

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