Mercatus Energy

Fuel Hedge Restructuring Strategies Amidst a Global Health Crisis & Economic Uncertainty

Commercial & Industrial Fuel Consumer Hedge Restructuring Options A lot of time and attention is paid to the upstream (producers) in the energy commodity supply chain. While there are many, good reasons for this, what about the other end of the...

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oil & gas producer hedging

How Can Oil & Gas Producers Optimize Hedge Portfolios in Current Market?

Unprecedented price decline presents hedge optimization opportunities As a result of the significant decline in crude oil prices, E&P companies who...

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How Do OPEC Announcements Impact Crude Oil Prices?

The Organization of Petroleum Exporting Countries (OPEC) is reportedly considering another production cut in response to the recent weakness in oil...

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Basis - An Often Overlooked Aspect of Natural Gas Hedging

Natural gas basis rarely receives the attention it deserves, but can make or break a commercial hedging, marketing or supply strategy. In West Texas,...

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Unique Natural Gas Deal Provides "Ideal" Hedge for Both Buyer & Seller

Cheniere Energy, Inc. and Apache Corporation recently committed to a long-term gas supply agreement that made headlines because of how the natural...

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Crude Oil Options: Understanding Volatility and Time Value

Volatility and time are just as important to understanding option premium as intrinsic value. This is especially true for a hedger who uses out of...

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Optimizing Oil & Gas Producer Hedge Portfolios with Call Options

In our last post, Can Activity in Crude Oil Options Provide Insight into Crude Oil Price Trends, we explored the definition of delta, as well as it’s...

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oil-drums

Can Activity in Crude Oil Options Provide Insight into Crude Oil Price Trends?

In a recent Bloomberg article, “In a Risky World, Oil Traders Bet on $100 a Barrel” the author explored how, “Some oil traders have started to gear...

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As Crude Oil Approaches $40/BBL, Warren Buffet Provides Great Hedging Advice

Are crude oil prices headed back below $40/BBL or even $30/BBL? Prompt NYMEX WTI futures settled last night at $42.92/BBL, while prompt Brent futures...

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Oil & Gas Hedging with Deep Out-of-the-Money Options and a Limited Budget

The need for effective hedging and marketing is greater in the current price environment i.e. $50/BBL than it is in a higher price environment i.e....

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