Practical Oil Trading Training Course
Course Highlights and Agenda
This course is designed to provide you with a practical introduction to oil products, oil trading, market participants and fundamentals such as pricing. Additionally, you will gain a detailed insight into risk management, trading strategies and derivatives.
Scroll down for agenda or book onto this course.
Agenda
Introduction to the Oil Industry
- Sectors
- Upstream
- Midstream
- Downstream - Features of crude oil
- Sweet vs. sour
- Light vs. heavy - Global benchmarks
- WTI
- Brent (Dated Brent, BFOE)
- Dubai quality - Reserves & Technique
- Peak-oil theory
- Tar sands & oil shale - Transport
- Geo-politics
- Environmental issues
The Refinery Process
- Refining
- Refinery products
- Types of refineries
- The construction of refineries
- Where should they be located?
- How the quality of crude influences the relative output of derivatives
- The value of refinery products
- The competition with bio-fuels - Crack spreads
- 5:3:2
- 3:2:1
- 2:1:1
Oil Pricing
- Benchmarks & indices
- Fundamental price drivers
- Geographical spreading
- Quality
- Reserves
- Currency of denomination
- Production (capacity)
- Consumption
- Transport & infrastructure
- Weather
- Seasonality
- Geo-politics
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
OTC vs. Exchange Trading
- OTC markets
- Credit risk - Exchange trade
- NYMEX
- ICE
- DME
* Listed products
* Futures
* Options
* Swaps
* Crack spreads - Integration of OTC markets & exchanges
- OTC give up facility
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
Risk Management
- Identification of risk types & kinds
- Operational risk
- Credit risk
- Market risk - Measuring risk
- Value at Risk - Controlling risk
- Hedging
Hedging Tools & Strategies
- Tools
- Derivatives
* Futures
* Options
* Swaps - Strategies
- Natural counterparties
- Long term vs. short term hedging
- Frequent mismatches
- Caps
- Floors
- Collars - Agreements & conditions
- Alternative Delivery Procedure (ADP)
- Trading at Settlement (TAS)
- Exchange for Physicals (EFP) - Collateral & margin
- Clearing & settlement (cash or physical)
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
Spread Trading
- Correlation
- Pairs & proxies
- Forward curves
- Backwardation
- Contango
- Convenience yield - Curve trading & arbitrage
- Spread trading
- Quality spreads
- Location spreads (basis trading) - Cross margining
What You Will Learn
Attend this intensive two-day course and acquire practical insight into:
- The working processes in the oil industry: covering upstream, midstream and downstream
- How refineries and refinery processes work
- The nuances of international oil markets, products traded within them and the applications of those products
- The practicalities of oil pricing, benchmarks and indices
- A whole host of trading techniques, get to grips with the various methods and applications
- The inner workings of oil trading platforms (exchanges)
- Risk management techniques in oil trading, learn how to identify, measure and control those risks
- What the future may hold for the oil markets
Reviews
"The course was very good, excellent presentation, explanation, case studies…very good…(course leader) Jerry has an exellent knowledge and skills to explain in the best way…thank you for this exellent training"
