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An Introduction to Consumer Natural Gas Hedging - Part VI - Call Spreads

 

This post is the sixth in a series where we are exploring many of the hedging strategies which are available to commercial and industrial natural gas consumers. The first and second posts can be found via the following links: An Introduction to Consumer Natural Gas Hedging - Part I - Futures, An Introduction to Consumer Natural Gas Hedging - Part II - Swaps, An Introduction to Consumer Natural Gas Hedging - Part III - Basis, An Introduction to Consumer Natural Gas Hedging - Part IV - Call Options and An Introduction to Consumer Natural Gas Hedging - Part V - Costless Collars.

An Introduction to Consumer Natural Gas Hedging - Part V - Costless Collars

 

This post is the fifth in a series where we are addressing the various hedging strategies which are available to commercial and industrial natural gas consumers. The first and second posts can be found via the following links: An Introduction to Consumer Natural Gas Hedging - Part I - Futures, An Introduction to Consumer Natural Gas Hedging - Part II - Swaps, An Introduction to Consumer Natural Gas Hedging - Part III - Basis and An Introduction to Consumer Natural Gas Hedging - Part IV - Call Options. In the next post in this series we'll explore how commercial and industrial natural gas consumers can hedge with call option spreads.

An Introduction to Consumer Natural Gas Hedging - Part IV - Call Options

 

This post is the fourth in a series where we are exploring the various hedging strategies which are available to commercial and industrial natural gas consumers. The first and second posts can be found via the following links: An Introduction to Consumer Natural Gas Hedging - Part I - Futures, An Introduction to Consumer Natural Gas Hedging - Part II - Swaps and An Introduction to Consumer Natural Gas Hedging - Part III - Basis.  In future posts we'll explore how commercial and industrial natural gas consumers can hedge with collars as well as other strategies.

Mercatus Energy Advisors in Hong Kong & Barcelona

 

In the coming weeks we will be in Hong Kong and Barcelona (and most likely, surrounding cities/ countries as well) for industry events and meetings with clients. If you would like to meet with us while we are in either Hong Kong or Barcelona please let us know.

Chicago & Group 3 ULSD Basis Blowouts Provide Fuel Hedging Lesson

 

On Friday Chicago ULSD spot prices jumped $0.1875/gallon putting Chicago spot prices at $0.29 over November NYMEX ULSD futures, the highest Chicago ULSD has traded vs. NYMEX since May 2013 when it traded at $0.33 over NYMEX. Similarly, Group 3 ULSD spot prices increased $0.0525 to $0.2625 over NYMEX ULSD futures, the highest it has traded vs. NYMEX since distillate basis differentials began referencing the NYMEX ULSD futures (previously distillates basis differentials referenced NYMEX heating oil futures). What's driving Midwest prices higher? Maintenance at refineries throughout the Midwest and strong agricultural demand for diesel.

Opportunistic Diesel Fuel Hedging Strategies as Oil Markets Collapse

 

As crude oil and refined products continue to decline, we're hearing from many commercial and industrial fuel consumers who are looking for "opportunistic" hedging strategies that will protect them against higher prices while not exposing them to downside price risk, should prices continue to decline from here. While most fuel consumers tend to hedge with traditional strategies such as swaps, call options and costless collars, markets with strong downward (as well as upward) momentum, such as the current one, tend to cause many hedgers to want to think outside of the box. 

An Introduction to Consumer Natural Gas Hedging - Part III - Basis

 

This post is the third in a series where we are exploring the various hedging strategies which are available to commercial and industrial natural gas consumers. The first and second posts can be found via the following links: An Introduction to Consumer Natural Gas Hedging - Part I, and An Introduction to Consumer Natural Gas Hedging - Part II.  In future posts we'll explore how commercial and industrial natural gas consumers can hedge with options and more complex instruments.

Are Crude Oil Prices in the Early Days of a Sustainable Bear Market?

 

As crude oil prices have declined by over 20% since late June, many are now wondering, are prices approaching a bottom or are we in the early days of a sustainable bear market?

An Introduction to Consumer Natural Gas Hedging - Part II - Swaps

 

This post is the second in a series where we are exploring the various hedging strategies which are available to commercial and industrial natural gas consumers. You can access the first post, An Introduction to Consumer Natural Gas Hedging - Part I, via this link.  In subsequent posts we'll explore how commercial and industrial natural gas consumers can hedge with options, basis swaps and more complex instruments.

An Introduction to Consumer Natural Gas Hedging - Part I - Futures

 

As we once again approach the winter heating season, we've received several questions regarding consumer (end-user) natural gas hedging. As such, this is going to be the first post in a series of several where we explore the various hedging strategies which are available to commercial and industrial natural gas consumers.

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