The programmes “Oil, Oil Markets & Trading” (all levels) are specifically designed to expand students’ knowledge of, and skills with respect to, a specific energy product, namely oil. The programmes cover oil operations, crude refinery & processing, oil storage & strategic reserves, transport, organisation of the global, oil markets, oil pricing, trading of oil, oil-related products & oil derivative contracts, oil trading platforms, oil asset & portfolio management, asset-backed trading, optimisation of oil portfolios, oil trading strategies, and trading-related processes, such as settlement, invoicing, valuation of oil positions & finance.
In the first level of the “Oil, Oil Markets & Trading” programme focus is on the physicality of oil. The programme incorporates the essentials of the physical product (crude oil & oil-related products). It covers the oil value chain, and ranges from production, via transport & storage, to its processing, refinery, distribution and consumption. Knowledge of physicality is essential in order to understand pricing mechanisms, taxation, organisation of oil markets and create fundamentals for oil-related products. Without knowledge of physical features one cannot embed logic with respect to trading & risk management.
Oil value chain – Physicality
Reserves & Production
Crude oil – Grades & benchmarks
Refining – Refinery capacity & crack spread
Crude selection – Product slate
Transport – Pipelines & tankers
Contracts & pricing – Price drivers
OPEC – Role & developments
Exam & Certification
In the second level of the “Oil, Oil Markets & Trading” programme focus is on the trading of oil, and therewith at markets, products and pricing. In this programme special attention is provided to physical players, and therefore focus is on sourcing, sales, and hedging of the procurement and sales exposures (consumer and producers hedges). The trading environment is described and attention is given to trading-related terminology. Derivative contracts with respect to crude and refinery products are incorporated. Student learn the fundamentals of forwards & futures, swaps and options. From a hedging perspective the main focus is on oil forwards & futures.
Oil forward market
Oil exchanges & brokers
Oil forwards & futures – The varieties
Oil forwards & futures – The application
Oil forwards curves – Pricing of oil forwards & futures
Hedging oil refinery capacity – Trading crack spreads
Hedging oil storage capacity – Trading time spreads
Hedging oil transport capacity – Trading location spreads
Settlement of oil forwards & futures – Part 1
Settlement of oil forwards & futures – Part 2
Exam & Certification
In the third level of the “Oil, Oil Markets & Trading” programme focus is on trading, and incorporates asset & portfolio management. The topics and themes incorporated in the previous programme (Intermediate level) are also incorporated in this programme, but are now taken into depth. Optimisation of the allocation of assets (such as storage and refineries) is taken into consideration. Next, arbitrage techniques are looked at and a basis is created for proprietary trading. The application of oil derivative contracts is thoroughly incorporated; participants are explained how oil swaps and oil options can be used for hedging, arbitrage as well as speculative activities.
Accounting – Book structure & internal transfers
Customer portfolio
Physical oil assets
Oil swaps – Physical settlement
Oil swaps – Cash settlement
Oil options – Outright options
Oil options – Application for hedging purposes
Oil options – Embedded optionality
Exam & Certification
In the fourth level of the “Oil, Oil Markets & Trading” programme focus is on optimisation of oil portfolio’s, and goes into depth on speculation. Seeking opportunities and avoiding pitfalls are incorporated. Proprietary trading is looked at by means of high sophisticated trading techniques and strategies. The complexity of some specific oil trading strategies and activities leads automatically to an increased importance of risk management. This automatically implies that risk management gets attention in this programme, because the more trading is done by means of speculation, the more importance risk management gets.
Oil risk management – Value-at-risk (VaR) of an oil position
Oil risk management – Risk off-set due to correlation
Oil risk management – Value-at-risk (VaR) of an oil portfolio
Oil risk management – Off-setting risk due to opposing exposures
Modelling – The real option approach
Modelling – Physical oil assets as real options
Modelling – Complexity: Valuation & hedging of spread options
Modelling – Optimizing the hedges
Exam & Certification