Advanced Energy Price Risk Management & Hedging
The Energy Price Risk Practitioner Series are designed to provide participants with an understanding of pricing, risk management, asset valuation and derivatives within the energy markets.
“Advanced Energy Price Risk Management & Hedging,” permits a deeper but still accessible analysis of issues covered in the first module, including methods and analyses, as well as extensions into additional areas of price risk assessment and management.
For example, the “Advanced” module permits understanding the relationship between crude-oil prices and inflation, the optimization of risk management at the corporate level, a deeper understanding of volatility, extrapolation of longer-dated futures prices (for valuation of long-dated assets) and additional measures of Value-at-Risk.
- Key Takeaways
- Use financial models to analyze and forecast energy prices; extrapolate forward prices beyond the liquidity tenor
- Understand the risk of and return from futures and options contracts on energy commodities
- Manage and optimize their corporations’ energy risk exposure
- Estimate and calculate volatility in energy prices
- Apply option valuation techniques to the energy markets
- Understand and use derivative products to mitigate energy price risk; use structured products to enhance firm value; understand exotic structures unique to oil (e.g., average option) and gas and power (e.g., swing options, weather derivatives)
- Utilize real options theory to value energy assets; use information from futures/option prices to make optimal production decisions: Optimal timing for extraction, optimal rate at which to extract oil (gas) from a field; value oil fields, pipelines and storage facilities, power plants
- Apply Value-at-Risk to the energy industry
- Who should attend?
Those who work with:
- Oil and gas exploration companies
- Production and distribution companies
- Coal companies
- Energy trading firms
- Oil-field services
- Energy-intensive manufacturer
- Transportation companies especially air
- Investment and commercial banking
- Financial services firms
- Consultants in energy sector
- Financial analysis
- Risk management
- Quantitative analysis
- Financial analysts
- Quantitative analysts or researchers
- Energy traders dealing with commodities
- Risk Managers dealing with commodities
- Commercial and investment bankers dealing with commodities
- Consultants in the commodity arena
- Government and regulatory officials, especially those with responsibilities for the energy sector
- About the trainer:
- The trainer is currently a Professor of Finance at the University of Texas at Austin.
His expertise covers investments, interest rate-sensitive instruments and energy derivatives in the academic and practitioner literature. He is the editor of Real Options and Energy Management: Using Options Methodology to Enhance Capital Budgeting Decisions published in 2002 by Risk Books, London.
While on a two-year 1991 - 1993 leave of absence from the University of Texas, he served as Vice President, Trading Research Group at Merrill Lynch & Co. From Jan. 2010 to Feb. 2011, he served as Commodity Market Modeling practice area manager at Morgan Stanley & Co.
Since 1993, he has served as consultant to government agencies, an insurance company, investment banks, risk advisory firms and an energy-derivative software vendor in the interest-rate and energy-commodity arenas. In Nov. 2004, he was one of fifty individuals selected by Energy Risk Magazine to the “Energy Risk Hall of Fame."
In the energy-consulting area, he hasaddressed the multiple issues of Risk Assessment; Construction of Optimal Hedge Portfolios; VAR and CVAR; Dual-Fuel Options; Valuation of Load-Following Services; Modeling Energy Prices and Pricing Monthly and Daily Options; and the Valuation and Optimal Management of Storage Facility.
Dates Location 24 - 25 August 2011 (Wed-Thur) Royal Plaza on Scotts, Singapore Download Brochure
- Managing Energy Price Risk (22 - 23 August 2011), Royal Plaza on Scotts, Singapore
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Real-Life Case Studies
- “Advanced Energy Price Risk Management & Hedging”
- “Optimizing Exposure to Natgas Prices for a Major NG Producer”
- “How two different types of energy companies incorporate the use of options in their risk-management”