Course dates
A 5-day course giving you insight and knowledge of:
- The working of processes in the oil industry
- Upstream, midstream & downstream
- Production & consumption
- Market participants & their roles
- The working of refineries & refinery processes
- The working of international oil markets
- Products traded in the oil markets
- The working and applications of those products
- The working of oil trading platforms (exchanges)
- Pricing, benchmarks & indices
- Risks connected to oil trading
- Correlation
- Skew & kurtosis in distribution of chances
- Usual trading techniques & methods
- Future perspective of the oil markets
Course Overview
The Oil Trading course is designed to provide participants with in-depth knowledge of oil products, oil trading, market participants and fundamentals such as pricing. Additionally, a broad practical insight regarding risk management and trading strategies with derivatives is provided.
The training sessions have a strong interactive character whereby the contribution of participants is of utmost importance. A picture of the working of oil markets, relevant developments, risks and other relevant issues is given during the training sessions by means of questions, theory and theses.
Who Should Attend
Euromoney’s Oil Trading training courses are particularly suitable for the compliant financial and energy community including:
- Oil traders, gas traders, energy traders &commodity traders
- Risk managers
- Back office employees in the oil sector
- ICT staff in the oil sector
- Oil executives in banking & corporate finance
- Oil credit & equity analysts
- Oil equity & commodity traders
- Investment & portfolio managers
- Financial consultants to the oil sectors
Day 1
Introduction to the oil industry
- Sectors
- Upstream
- Midstream
- Downstream
- Features of crude oil
- Sweet versus sour
- Light versus heavy
- Global benchmarks
- WTI
- Brent (Dated Brent, BFOE)
- Dubai qualit
- Reserves & technique
- Peak-oil theo
- Tar sands & oil shal
- Refineries, refinery processes & productsTransport
- Geo-politics
- Environmental issues
Exercise: Freight derivatives
The refinery process
- Refining
- Refinery products
- Types of refineries
- The construction of refineries
- And where should they be located?
- The quality of crude influences the relative output of derivatives
- The value of refinery products
- The competition with bio-fuels
- Crack spreads
Exercise: Calculate crack spreads
Oil pricing
- Oil pricing
- Benchmarks & indices
- Fundamental price drivers
- Geographical spreading
- Quality
- Reserves
- Currency of denomination
- Production (capacity)
- Consumption
- Transport & infrastructure
- Weather
- Seasonality
- Geo-politics
Exercise: Weather derivatives
Day 2
Oil trading
- Working of the oil markets
- Market participants
- The role of cartels (OPEC)
- Contract specifications
- Trading unit
- Price quotation
- Trading months
- Trading at Settlement (TAS)
- Alternative Delivery Procedure (ADP)
- Exchange of Futures for Physicals (EFP)
- Trading & position limits
- Physical vs. financial settlement
- Deliverable grades
- Structuring of contracts
- Physical delivery vs. cash settlement
- Trading
- Bilateral transactions
- Bunker trading
- Rotterdam
- Houston
- Singapore
- Fujeirah
Exercise: Gas supply contracts: Gas pricing based on oil formula (gas-to-oil pricing)
OTC vs. Exchange trading
- OTC markets
- Exchange trade
- NYMEX
- ICE
- DME
- Listed products
- Futures
- Options
- Swaps
- Crack spreads
- Integration of OTC markets & exchanges
Exercise: WTI contract specifications
Exercise: Auction vs. continuous trading
Day 3
Trading & risk
- Markets
- Products
- Trading
- Hedging
- Arbitrage
- Speculation (proprietary trading)
- Management issues
- The increasing importance of trading floors and dealing rooms
- The increasing role of proprietary trading
Exercise: Proprietary trading & the role of speculators
Risk management
- Identification of risk types & kinds
- Operational risk
- Credit risk
- Market risk
- Measuring risk
- Controlling risk
Exercise: VaR
Exercise: Calculation of the exposure of an oil vs. gas portfolio
Exercise: Stress testing
Day 4
Hedging tools & strategies
- Tools
- Strategies
- Natural counterparties
- Long term vs. short term hedging
- Frequent mismatches
- Caps
- Floors
- Collar
- Agreements & conditions
- Alternative Delivery Procedure (ADP
- Trading at Settlement (TAS)
- Exchange for Physicals (EFP)
- Collateral & margin
- Clearing & settlement (cash or physical)
Exercise: Hedging a kerosene portfolio with heating oil futures
Exercise: Credit risk
Exercise: Oil swap: fixed-for-floating
Volatility
- What is volatility?
- Historical volatility, future volatility & implied volatility
- How is volatility measured?
- What does volatility imply?
- Volatility as input for pricing options
- Skew & Kurtosis
Exercise: Volatility trading
Day 5
Spread trading
- Correlation
- Pairs & proxies
- Forward curves
- Backwardation
- Contango
- Convenience yield
- Curve trading & arbitrage
- Spread trading
- Quality spreads
- Location spreads (basis trading)
- Cross margining
Exercise: Spread trading
Exercise: Correlation trading
Liquidity
- Liquidity risk
- Liquidity on the forward curve
- Roll-over of positions
- Roll yield
Exercise: Liquidity risk, proxy hedging & time spreads
Summary & conclusions
Singapore Hotel, Singapore, Singapore
This programme takes place on a non-residential basis at a central Singapore hotel. Non-residential course fees include training facilities, documentation, lunches and refreshments for the duration of the programme. Delegates are responsible for arranging their own accommodation, however, a list of convenient hotels (many at specially negotiated rates) is available upon registration.
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Jerry De Leeuw
Jerry completed his study in Economics in 1995 and became a Market Maker on the trading-floor of the European Option Exchange (EOE) in Amsterdam. He was employed by Curvalue on EOE, Amsterdam Exchanges (AEX) and Euronext. In 1999 he established his own Market Maker company, which was licensed under the supervisory body AFM. This firm became a Member of Euronext Liffe, and had clearing-contracts with Fortis, KBC bank and Goldman Sachs.
Over the years, Jerry has traded by open out-cry on the floors of various exchanges and has a great deal of experience in screen-based trading. He has extensive experience in a variety of products; ranging from stocks, currencies and commodities to futures, options and structured products. With the Anglo-Dutch energy exchange APX-Endex Jerry was (on an interim-basis) responsible for the development of the continental gas markets in Belgium and The Netherlands (2007). In this role he visited the dealing rooms of their members throughout Europe.
Jerry delivers lectures at universities and was also project manager for the development of a new oil index. This global price basket and its underlying scientific research paper was first presented at the symposium Energy & Value, organized by Multinational Finance Society, incooperation with Rijks Universiteit Groningen and Energy Delta Institute. In 2008 and 2009 Nyenrode Business University embraced the project and this meant that Jerry was connected to this university in that period.
Jerry is a columnist for several media, and is author of the books 'Milkshakes & Butterflies', 'Hit & Lift' and 'Energy problems & future perspective'.
Interested in holding this course in-house? Please fill out your details and a member of our team will be in touch with more information.
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5-8 Nov 2012 (Hong Kong, Hong Kong)
4 days of course modules that focus on the review and examination of the key elements of the supply chain from upstream activities of exploration, development and production through transportation to downstream sector that involves trading, refining, petrochemicals and final distribution to the consuming markets.
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This course is designed for professionals who need to develop an understanding of the unique aspects of the energy industry, including the oil and gas commercialisation and business development or facilities evaluation and commercialisation.
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25-27 Sep 2012 (Singapore, Singapore)
This Fundamentals of Crude Oil Valuation & Pricing course covers everything you need to know about how oil is traded and priced in the international market. The course covers the valuation and pricing of physical cargoes of crude oil, as well as how derivatives such as oil futures and swaps are structured.
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Featuring 3–individually bookable modules:
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20-22 Aug 2012 (London, UK)
22-31 Oct 2012 (Hong Kong, Hong Kong)
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24-27 Sep 2012 (London, UK)
15-18 Apr 2013 (London, UK)
The Commercial and Trading Aspects of Oil Refining course will provide you with in-depth knowledge of the refining business and an understanding of how trading/hedging can improve margins and reduce risk. Discover how to optimise refinery margins and manage the profitability of commercial refining.
20-24 Aug 2012 (London, UK)
This Euromoney Energy Training course provides a comprehensive overview of the oil and gas industry from upstream exploration and production to downstream refining, sales and marketing. You will gain an appreciation of industry dynamics and the key issues affecting its development and future. This course will provide a thorough foundation for understanding the changing industry dynamics.
8-10 May 2013 (London, UK)
This course will investigate the mechanisms for trading physical oil, freight, shipping and derivatives to optimise margins and achieve profit targets. The interdependence between oil markets and ship chartering will be extensively explored, revealing links to the derivative markets and the use of trading tools.
17-19 Oct 2012 (London, UK)
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8-10 May 2013 (London, UK)
This course will investigate the mechanisms for trading physical oil, freight, shipping and derivatives to optimise margins and achieve profit targets. The interdependence between oil markets and ship chartering will be extensively explored, revealing links to the derivative markets and the use of trading tools.
17-20 Dec 2012 (Dubai, United Arab Emirates)
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3-5 Dec 2012 (London, United Kingdom)
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29-31 Oct 2012 (London, UK)
This course is designed for professionals who need to develop an understanding of the unique aspects of the energy industry, including the oil and gas commercialisation and business development or facilities evaluation and commercialisation.
The course will focus on the skills required in evaluation (both buyside and sell-side), financing, acquisition, and exploitation planning for an oil and gas entity, a midstream facility or electrical generation plant.
17-19 Sep 2012 (London, UK)
19-21 Nov 2012 (Singapore, Singapore)
16-19 Jul 2012 (London, UK)
4 days of course modules that focus on the review and examination of the key elements of the supply chain from upstream activities of exploration, development and production through transportation to downstream sector that involves trading, refining, petrochemicals and final distribution to the consuming markets.
28-30 May 2012 (London, UK)
This Fundamentals of Crude Oil Valuation & Pricing course covers everything you need to know about how oil is traded and priced in the international market. The course covers the valuation and pricing of physical cargoes of crude oil, as well as how derivatives such as oil futures and swaps are structured.
Course dates