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CRUDE OIL forecasting
NATURAL GAS forecasting
SUGAR forecast
COCOA forecasting
COFFEE forecasting
CORN forecasting
SOYBEAN forecast
A Guide to Energy Hedging
A Guide to Metals Hedging
Accounting Treatment for Hedging
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https://www.theice.com/homepage.jhtml
The “Short” or Selling Hedge for Crude Oil and Refined Products
Establishing what is known as a "short" or selling hedge protects energy industry
participants from adecline in the market price of crude oil or refined products. This
type of hedge would be used by producers, oil refiners, products wholesalers, and
retailers -- anyone in the oil industry who could be adversely affected by declining
product prices. These same market participants could also use a "long" or buying
hedge to protect themselves againstrising prices. The example set forth below illus-
trates a short hedge for use by a heating oil distributorship which wishes to protect the
value of its inventory.
The Long or Buying Hedge for Crude Oil and Petroleum Products
A company which plans to purchase refined products can effectively use the long
hedge to protect against the risk of price increases. High volume buyers such as elec-
tric utilities, manufacturing companies, terminal operators and trading companies, real
estate management firms, municipalities, gasoline station owners, car rental fleets, and
rapid transit districts want to ensure a low product acquisition cost.