Course description
Face-to-Face Academy: Crude Oil
The Crude Oil Face-to-Face Academy is an engaging and interactive course that will help you understand how a trader extracts value and manages risk in an Crude Oil portfolio.
Delivered over 3 days in a class room, it features engaging and interactive lectures coupled with a number of realistic physical trading simulations via our unique simulator, Ignite; giving you the opportunity to experience the psychological highs and lows of commodity trading.
Duration: 3 days
Course Dates: 10-12 December 2024
Timings: 9am-5pm GMT
Location: London, UK
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Upcoming start dates
Suitability - Who should attend?
Suitable for individuals working in organisations such as:
Trading companies, Banks, Brokers, Oil producers, Consumers, Refiners, Distribution companies, Government and Associated organisations.
Including roles in:
Back office, Accounts, Financial operations, Middle office, Trade control, Analysts and Front office, Juniors, Managers and Operations.
Outcome / Qualification etc.
By completing/passing this course, you will attain the certificate TwoTwoFive Certificate Crude Oil and achieve 24 CPD points.
Training Course Content
Day 1
Derivatives
- What is trading and why do companies trade
- Explains some trading terminology
- What is a crude oil derivative
- What the difference between forwards, futures, swaps, and options are
- How they are connected, EFP, EFS
- How a futures exchange works
- How traders use crude oil derivatives
Ignite simulations – Up to 3 trading simulations where delegates will be able to trade futures, swaps, and forwards
Trading Best Practice
- What is risk
- The different types of risk - price, credit, operational, reputational
- How risk can be managed successfully by a trader
- Technical analysis
- How risk is measured, what is VAR and how is it used
- Trading lessons - common pitfalls
Ignite simulations – 2 trading simulations where delegates will be able to trade Brent futures within a VAR trading limit
Time Spreads
- What is spread trading/different types of spread?
Principles of spread trading
What a forward curve is and market structure
Different types of market structure and what they signify
How traders use time spreads
Ignite simulations – 2 trading simulations where delegates will be able to trade Brent and WTI futures within a VAR trading limit
Day 2
Cargo Price Exposures
- What is physical cargo trading
- Physical delivery terms
- Factors that influence supply/demand
- Crude oil quality
- Contractual considerations
- Price reporting agencies - who are they and what they do
- Explain floating prices and benchmark prices
- What is crude oil differential trading
Ignite simulations – 2 trading simulations where delegates will be able to trade North Sea and West African physical crude oil cargoes
Arbitrage
- Explains physical arbitrage
- Different aspects of crude oil
- Voyage chartering/Time charter
- Bareboat charter
- Contract of affreightment
- Worldscale - what it is and how it works
- Operational costs of arbitrage
- Financial risks
- When traders arbitrage
- Netback calculation
Ignite simulations – 2 trading simulations where delegates will be able to trade American, North Sea and Middle Eastern physical crude oil cargoes, charter vessels and manage price risk exposures
Hedging
- Why hedge
- Basis risk
- Swaps as hedging instruments
- Types of hedging
- A detailed example of hedging a fixed price/floating price cargoes
- Operational impact on pricing
Ignite simulations – Up to 3 trading simulations where delegates will be able to apply arbitrage and unwinding hedges and charter vessels as physical cargoes price in/out
Day 3
Storage
- What is storage/why store oil
- The costs/benefits associated with storing oil
- When traders store oil
- Types of market structure
- How to hedge a storage play
- Intrinsic and Extrinsic Value
Ignite simulations – 2 trading simulations where delegates will be able to store American and European crude oil cargoes and apply hedges to capture the storage play
Team Dynamics
- How to extract value from a physical crude oil portfolio
- Why speedy evaluation of opportunities is critical
- Why teamwork is important
- Applying all the trading concepts learnt across a portfolio
- Understanding the value of tenders
Ignite simulations – Working as a team, the delegates will apply all the trading concepts across a portfolio of crude oil cargoes, trading spot cargoes, entering tenders, hedging, arbitrage, seeking storage opportunities and speculatively trading the futures markets with flat price and spreads positions.
Course delivery details
This Academy is a classroom based course in London, UK.
Why choose TwoTwoFive
Practice trading with IGNITE trading simulator
1,000s of individuals from 100s of companies trained over the last 10 years
Our trainers have a combined 100+ years of trading experience