Market risk
Seeking an end to manipulation
Renewed allegations of manipulation of natural gas pipeline capacity in the US have been partly blamed on regulatory complacency. How can regulators put an end to the problems dogging the gas markets? Catherine Lacoursière reports
...while AEP exits Nordic energy trading
Ohio-based American Electric Power (AEP) last month completed its exit from theNordic energy trading market. The management team responsible for AEP’sactivities in the Nordic region will assume AEP’s Nordic trading book,office leases and related…
US power sector decline slows, says Fitch
The US power sector has seen little more than a slowing in the rate of its declinein 2003, said Richard Hunter, managing director of rating agency Fitch’sglobal power group, in May.
Energy firms find succour
US energy company debt has reached critical levels, with nervous investors and banks working hard to keep these companies afloat. But Paul Lyon finds the secretive hedge fund industry could also lend a helping hand
David Mooney
With 34 trading offices active in 40 countries, Swiss commodity trading house Trafigura is no small concern. But while the firm – perhaps best known for its oil, petroleum products and metals trading activities – employs some 600 energy traders worldwide…
Kiodex adds more energy forward curves
Kiodex, an energy risk management technology company based in New York, willadd five new forward curves to its global market data offering, it told delegatesat EPRM’s May congress in Houston.
Ferc calls for risk manager vigilance
The director of the office of market oversight and investigations (OMOI) at theUS Federal Energy Regulatory Commission (Ferc), has urged energy risk managersto alert his office to any suspicious market practices.
Detecting market transitions: from backwardation to contango and back
Svetlana Borovkova looks at detecting market transitions between backwardation and contango states using the forward curve. In this first part of a two-part article, she introduces two change indicators, which she applies to oil futures prices. Next…
Buying your way out of trouble
UK high-street retailer Littlewoods has saved £1.5 million through an energy risk management and procurement programme. Utilyx’s Nigel Cornwall looks at how other companies can reduce energy costs through purchase programmes
Power asset prices plummet
The energy price boom may be over, but bargain hunters beware: the predicted sale of US generation assets is yet to occur. Kevin Foster reports
Own, sell or restructure
UK and US utilities are presently saddled with a lot of debt, thanks to overcapacity and low power prices. But what’s the best way for these firms to deal with the power plants they don’t need? By Jessica McCallin
The case for financially settled contracts
Banks and hedge funds have shied away from trading electricity due to fear and ignorance of the physical nature of the market. But, as Todd Bessemer of Accenture points out, financially settled contracts can avoid the complexity of physical delivery and…
Applying modern portfolio theory to optimal gas purchasing
Yijun Du and Xiaorui Hu present a general framework for applying modern portfolio theory to optimal natural gas procurements. They show that successful natural gas procurement involves determining the optimal allocation between fixed-price and floating…
A Spanish power struggle
A takeover bid by gas distributor Gas Natural for power utility Iberdrola may provide the impetus for much-needed competition in the Spanish energy market. But the bid has upset many traditional links in politics, finance and business. By Maria Kielmas
The LMP supermodel
With Ferc’s standard market design (SMD) seeking a shift from zonal power pricing to nodal pricing, the concept of locational marginal pricing (LMP) has become a key policy issue. Henwood Energy’s Vikram Janardhan proposes 10 key modelling features to…
Carbon across Europe
Pan-European emissions trading is a step closer after agreement of an EU directive. Atle Christiansen and Kristian Tangen of Point Carbon look at the consequences
Tough talk on derivatives
The Commodity Futures Trading Commission and Ferc are getting tough in throwing fines around. Is this a ploy to avoid being lumbered with further over-the-counter regulatory responsibilities? Some market participants certainly think so. By Paul Lyon
Wanted: cash for new lines
Can Ferc’s standard market design encourage much-needed investment in the US power grid and develop a merchant model for transmission assets? By Kevin Foster
Speculate away
A new report argues that speculative trading in the crude oil markets contributes far less to volatility than its critics suggest. Kevin Foster looks at the arguments
A formula for high prices
The US chemical industry is crying foul over spiralling natural gas prices, but there are measures they can take to protect themselves, as Kevin Foster discovers