This course will explain why traders may consider hedging a cargo of LNG in different circumstances, how arbitrage hedges are unwound and why understanding pricing exposure is so important. The course contains the following chapters: First concepts; Fixed price hedging and floating priced hedging.
After completion of this course you will understand:- why hedging is important; what basis risk is; what different derivatives are used to hedge LNG cargoes; different types of hedges – Arbitrage and Unwinding; the price risk created by trading fixed price LNG cargoes; managing price risk on a floating priced LNG cargo during physical pricing.
Approx. 60 mins