Energy trading has escalated significantly in importance globally.

What is Energy Trading?

Energy trading is similar to trading other commodities, where trading occurs based on the existence of sufficient supply and demand. The most commonly traded energy commodities include crude oil and its derivatives, natural gas, coal, power, and petrochemicals.

Energy can be traded in the financial market through energy derivatives. Energy derivatives are contracts based on underlying physical assets such as crude oil, power, natural gas, and others. These contracts can take the form of futures, options, and over-the-counter (OTC) derivatives like forwards, swaps, options, and swaptions. They are traded on exchanges such as the New York Mercantile Exchange (NYMEX), the Intercontinental Exchange (ICE), and the Tokyo Commodity Exchange (TOCOM).


Crude oil

Oil traders tend to specialize in a specific group of oil products, however some do trade ‘across the barrel’ meaning they have a multi-product oil focus.



Coal is the most abundant and affordable energy fuel. The global coal trading market is effectively divided into two regional markets, the Atlantic and Pacific regional markets.



Power trading happens on a ‘day ahead’ or intraday/real time basis to make sure demand is met in accordance with predicted or real time data.



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