Mastering Oil Trading Concepts (VIRTUAL CLASSROOM) - OTO2V 

CPE Credits Awarded: 12
Categories: Trading, Derivatives, Hedging and Risk Management, Oil Industry, Online Training, Oil Supply and Trading, Refining, Virtual Classroom Courses

Course Date Duration Venue Price Registration Deadline Register
19 Oct 2020 12 Days Globally Online - New York City & London Time Country: us
$ (USD)1,499.00
SOLD OUT!
09 Nov 2020 12 Days Globally Online - New York City & London Time Country: us
$ (USD)1,499.00
SOLD OUT!
24 Nov 2020 10 Days Globally Online - London & Singapore Time Country: sg
$ (USD)1,499.00+7%GST
30 Sep 2020

UPCOMING SCHEDULE DETAILS:

19,21,23,26,28,30 October 2020 - New York City Timezone
Session 1: 19 October 2020 at 10:00am - 12:00pm EST
Session 2: 21 October 2020 at 10:00am - 12:00pm EST
Session 3: 23 October 2020 at 10:00am - 12:00pm EST
Session 4: 26 October 2020 at 10:00am - 12:00pm EST
Session 5: 28 October 2020 at 10:00am - 12:00pm EST
Session 6: 30 October 2020 at 10:00am - 12:00pm EST

9, 11, 13, 17, 18, 20 November 2020 - New York City Timezone
Session 1: 9 November 2020 at 10:00am - 12:00pm EST
Session 2: 11 November 2020 at 10:00am - 12:00pm EST
Session 3: 13 November 2020 at 10:00am - 12:00pm EST
Session 4: 17 November 2020 at 10:00am - 12:00pm EST
Session 5: 18 November 2020 at 10:00am - 12:00pm EST
Session 6: 20 November 2020 at 10:00am - 12:00pm EST

24-25 November, 1-3 December 2020 - Singapore Timezone
Session 1: 24 November 2020 at 3:00pm - 5:00pm SGT
Session 2: 25 November 2020 at 3:00pm - 5:00pm SGT
Session 3: 26 November 2020 at 3:00pm - 5:00pm SGT
Session 4: 1 December 2020 at 3:00pm - 5:00pm SGT
Session 5: 2 December 2020 at 3:00pm - 5:00pm SGT
Session 6: 3 December 2020 at 3:00pm - 5:00pm SGT

COURSE SUMMARY

Mastering Oil Trading Concepts is a VIRTUAL classroom course presented by the energy training experts at Mennta Energy Solutions.

This workshop builds on the oil trading basics to extend your understanding of the complex world of oil trading and take your skills to a higher level.  

Topics explored during the course include crude oil valuation and selection, products valuation, blending and trading, pricing mechanisms and methodologies, practicalities of hedging and futures trading advanced trading and financial engineering, forward curves and market structure, trading controls, ethics and compliance.

A key element of the course is that you get the chance to put the knowledge learned into practice through a series of educational and enjoyable trading simulations.  These exercises are designed to reinforce and extend your learning from the class.

This virtual solution is comprised of four live instructor-led sessions hosted on state-of-the-art training software with video, audio, chat, live polls, competitive quizzes, breakout sessions and much more!  See recorded demonstrations here.  The program will also include several self-study assignments to maximize the time with the instructor.

WHO SHOULD ATTEND?

Class delegates include anyone wishing to know more about the world of oil trading, including traders, support staff, analysts, accountants and management in the areas of trading, supply, risk management, credit, finance, contracts, IT, operations, transportation and storage.

COURSE CONTENTS

Prerequisite to Session 1 Self-Study Assignment:  2 Hours On-Demand

  • Hedging with Futures and Options
    • Identify why hedging is important in managing volatility in profit and loss
    • Distinguish the types of hedges
    • Distinguish the differences between using futures and options for hedging purposes
    • Identify the problems caused by basis risk and how to deal with them
    • Identify the primary hedging strategies used by companies who hedge market risk

 Virtual Instructor-Led Sessions:  6 Sessions, 2 Hours per Session

  • Futures Trading Practicalities
    • Futures exchanges and their trading platforms
    • Contract specifications and termination rules
    • Margining systems and cash flows involved in opening, holding and closing futures positions
    • How physical delivery and cash settlement work for oil futures contracts
    • EFP and EFS deal process:  what is agreed, how they are invoiced, why and when they are used
  • OTC Derivatives Markets
    • Types of instruments: swaps, basis swaps, options
    • Common indices and settlement rules
    • Trading platforms, clearing and settlement in OTC trading
  • Hedging Principles
    • Sources of risk
    • Price exposure, pricing mechanisms, priced and unpriced trades
    • Aim and purpose of short-term (operational / tactical) hedges
    • Aim and purpose of strategic hedges
    • Timing of hedging decisions
    • Hedging with futures
    • Use of swaps and options in hedging
    • Basis risk, hedge efficiency, correlation and hedge ratios
    • Management of basis risk using basis swaps and EFPs
    • Hedge accounting
    • Impact of market structure on hedging
  • Hedging the Refinery
    • Strategic and tactical objectives
    • Basic refinery hedging choices and plan
    • Refinery hedging variations
    • Refinery hedging choices: operational, opportunistic, strategic
    • Hedging and refinery flexibility
  • Freight & Logistics
    • Freight costs and shipping economics
    • Factors to consider when chartering a vessel
    • Bottlenecks and key areas of delay, including demurrage considerations
    • Freight rates - calculation of Worldscale rates and time charter equivalents
    • Pipelines and rail - scheduling, tariffs, logistics
    • Storage
      • Types of storage
      • Standard contract terms
      • Costs
      • Evaluating storage opportunities
      • Implications of holding inventory (tax, reporting)
  • Crude Oil Valuation & Selection
    • How refineries evaluate different crudes – comparing crudes using LP models and netback calculations, marginal values, transportation and other logistical considerations
    • Crude oil quality differences between different regions; crude oil blending
    • Crude oil yields for different refinery configurations
    • Assessing crude differentials – what affects grade differentials and how to assess them;  monitoring and analysing differentials and basis
  • Crude Forward Markets
    • How forwards are used
    • Brent (BFOET) market, including bookouts, nominations, contract terms and timeline
    • Partials markets for BFOET and Dubai
    • North American benchmarks
  • Products Valuation, Blending and Trading
    • Effects of refinery process choices:
      • Feedstock selection
      • Product output objectives
      • Typical yields from different units; process flexibility and effects on product quality
    • Economics of product blending:
      • Quality of different blendstocks and their valuation
      • Evaluating product value
      • Linear/non-linear blending calculations
      • Mininimizing quality giveaway
      • Implications of biofuel blending
    • Arbitrage trading:
      • Evaluation of arbitrage opportunities
  • Pricing Mechanisms and Methodologies
    • Pricing mechanisms for spot and term contracts:
      • OSPs & tenders – different pricing formulas used in different regions
      • Calculations of discounts, premiums and quality escalators
    • Sources of price information:
      • Review of key information sources in different markets
      • Price reporting methodologies, including Platts e-window process
      • Assessments of illiquid markets, including calculations of dated Brent
  • Advanced Trading / Financial Engineering
    • Delta hedging
    • Monetisation of physical flexibility
    • Dealing and origination
    • Algorithmic and high-frequency trading
  • Forward Curves and Market Structure
    • Effects of contango/backwardation on trading behaviour
      • Inventory management
      • Hedging
      • Storage play opportunities
  • Trading Controls, Ethics & Compliance
    • Constraints on trader activity
      • Government regulations
      • Corporate policies
      • Position and market risk limits
      • Credit and counterparty constraints
  • What is allowed, and what is ethical?
    • Insider knowledge
    • Market manipulation (wash trades, squeezes, quote stuffing, etc.)
    • Speculative position taking
  • Measurement and control of trading exposure
    • VAR and VAR limits
    • Position limits
    • Loss limits
  • Regulation of oil trading
    • Exchange trading and position limits
    • OTC trading and clearing: EMIR, Dodd Frank Act
    • Price reporting: voluntary code and European regulation on benchmarks
  • Interactive content during the VILT sessions will include:
    • Exercises carried out during the VILT sessions, in breakout groups, on product blending opportunities, cargo pricing, crude quality and hedging.
    • A multi-round trading game and a competitive hedging simulation game, which would be introduced during the VILT sessions and played by delegates in their own time between VILT sessions.

FACULTY

Mary Jackson has over 15 years of experience in the energy industry. She began her career at BP working in the information management group, then later rose to a trading analyst in the supply and trading department. She subsequently joined Saladin as an energy consultant to provide consultancy advice and training on energy market analysis, trading and risk management to clients throughout the world. In several senior roles at Saladin, she managed the energy consulting team, ran the energy market information service and directed strategy for new software and information product development, including the development of a new internet based trading system. After leaving Saladin, Mary worked as an independent energy market consultant until she formed Kingston Energy Consulting in 2002. She has lectured regularly for Mennta Energy Solutions on energy markets, trading and risk management and is also a regular speaker and panel member at public conferences. She has written articles for industry publications including Harts Energy Markets, Energy and Power Risk Management, Global Energy Business and Petroleum Review. Mary obtained a bachelor's honours degree from Bristol University and a master's degree from London University.

Nigel Harris is a director and principal consultant at Kingston Energy Consulting, which he founded with Mary Jackson in 2002. He has been helping energy traders to analyse and understand the markets for over 25 years, initially as a developer of market analysis software systems, and more recently as a consultant. At Kingston Energy Consulting, his main focus is on providing education and information transfer to participants in the energy trading business, through instructor-led classroom training, web-based training development, research projects, workshops, briefings and research-based report writing. In his work with Mennta Energy Solutions, he has created a library of new instructor-led and web-based courses on European gas and power markets and trading. In 2005, he worked with Mary Jackson to develop the popular Oil Trading Orientation course, which has since been presented at venues all over the world. He has also extensively revised and updated many existing courses on derivatives, hedging and risk management.  He regularly presents this material both at public venues and as in-house, often customised, courses. He is co-author of a series of highly regarded reports on European natural gas trading and has also contributed to reports on power markets and oil trading. In previous roles, he was a key member of the team that initially designed and developed Saladin’s innovative Petroleum Analysis Workstation, a system that became an industry standard for historical price analysis during the 1990s and remained in use in the industry for two decades. During this period, he worked closely and extensively with oil and gas traders around the world to understand their information and analytical requirements. He also spent some years as an independent consultant, working mainly with software and information providers to help them better understand the oil and gas trading sectors.


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