Energy Market Course

Lesson 1 • Supply and Demand Fundamentals

Explains the core economic forces that set energy prices and volumes. Connects elasticity, seasonality, and geopolitics to observable price behaviour.

Lesson 2 • Energy Market Structures

Contrasts regulated, liberalised, and hybrid market structures across electricity, gas, and oil sectors. Sets the regulatory context for pricing and competition chapters.

Lesson 3 • Energy Commodities and Their Properties

Covers physical and chemical characteristics of major energy commodities and their market relevance. Establishes the commodity baseline needed for all subsequent pricing and trading topics.

Lesson 4 • Market Participants and Their Roles

Identifies producers, consumers, traders, brokers, and regulators and explains how each shapes market outcomes. Provides the actor map used throughout the course.

Lesson 1 • Electricity Pricing and Marginal Cost

Explains merit-order dispatch and how the marginal generator sets the clearing price. Connects generation cost structures to wholesale electricity price formation.

Lesson 2 • Price Indexation and Formula Pricing

Covers oil-indexed, hub-indexed, and hybrid gas pricing formulas used in long-term contracts. Prepares students to negotiate and audit contract price clauses.

Lesson 3 • Basis Differentials and Location Spreads

Defines basis as the price difference between two locations or grades and explains its drivers. Essential for understanding physical arbitrage and hedging basis risk.

Lesson 4 • Price Reporting and Benchmarks

Reviews how price reporting agencies collect and publish benchmark prices and their market authority. Students can critically evaluate benchmark reliability and manipulation risk.

Lesson 1 • Options on Energy Commodities

Introduces calls, puts, and exotic options used to hedge price floors, ceilings, and collars. Students can price simple options and explain the Greeks in an energy context.

Lesson 2 • Structured Products and Tolling Agreements

Examines volumetric production payments, tolling deals, and other structured energy contracts. Shows how complex instruments embed optionality within physical arrangements.

Lesson 3 • Swaps and OTC Derivatives

Covers fixed-for-floating swaps, basis swaps, and OTC contract documentation. Bridges exchange-traded instruments to the bilateral deals common in energy trading.

Lesson 4 • Derivatives Regulation and Reporting

Surveys post-crisis regulatory frameworks governing energy derivatives, including trade reporting and position limits. Ensures students can operate within compliance boundaries.

Lesson 1 • Credit Risk and Counterparty Management

Covers credit exposure measurement, netting agreements, and collateral management for energy trades. Prepares students to assess and mitigate counterparty default risk.

Lesson 2 • Hedging Strategy Design

Guides construction of hedge programmes using futures, swaps, and options for producers and consumers. Students can calculate hedge ratios and evaluate hedge effectiveness.

Lesson 3 • Quantitative Risk Measurement

Applies Value at Risk, Expected Shortfall, and scenario analysis to energy portfolios. Connects statistical methods to practical risk limits and capital allocation decisions.

Lesson 4 • Risk Governance and Reporting

Establishes the organisational structures, policies, and reporting cadences for effective risk oversight. Links risk management practice to board-level accountability.

Lesson 1 • Generation Asset Economics

Analyses the cost structures and dispatch decisions of thermal, hydro, nuclear, and renewable plants. Connects asset economics to bidding strategy and portfolio optimisation.

Lesson 2 • Cross-Border Power Trading

Examines interconnector capacity allocation, implicit and explicit auctions, and arbitrage across price zones. Builds on trade flow concepts to address power-specific cross-border dynamics.

Lesson 3 • Wholesale Electricity Market Design

Compares energy-only, capacity, and hybrid market designs and their investment incentive effects. Provides the structural context for all power pricing and trading topics.

Lesson 4 • Grid Balancing and System Operations

Explains how system operators balance supply and demand in real time and the imbalance settlement process. Prepares students to manage balancing exposure in a power portfolio.

Lesson 1 • Operational Risk and Compliance

Identifies key operational failure points and the controls used to mitigate them in trading operations. Reinforces the risk governance framework introduced in the risk management chapter.

Lesson 2 • Scheduling and Nomination

Explains gas and power nomination cycles, pipeline scheduling, and grid balancing obligations. Connects commercial deal terms to the physical delivery timeline.

Lesson 3 • Logistics and Transportation

Covers tanker chartering, pipeline tariffs, and LNG cargo logistics for oil and gas trades. Ensures students can evaluate freight costs and their impact on trade economics.

Lesson 4 • Deal Origination and Negotiation

Covers how physical energy deals are sourced, structured, and agreed between counterparties. Establishes the commercial foundation before operational execution topics.

Lesson 1 • Carbon Pricing Mechanisms

Compares cap-and-trade systems, carbon taxes, and hybrid instruments and their price formation logic. Establishes the carbon cost framework applied in subsequent trading and strategy sections.

Lesson 2 • Emissions Allowance Trading

Covers spot and futures trading of emissions allowances, registry mechanics, and compliance cycles. Applies derivatives knowledge to the carbon asset class.

Lesson 3 • Transition Risk and Portfolio Strategy

Assesses physical and transition climate risks in energy portfolios and strategies for repositioning. Integrates carbon and transition analysis into the broader risk management framework.

Lesson 4 • Renewable Energy and Clean Fuels Markets

Analyses markets for green hydrogen, biofuels, and renewable electricity certificates as transition commodities. Connects energy transition policy to emerging commodity market structures.

Lesson 1 • Portfolio Optimisation Techniques

Applies mean-variance optimisation, risk budgeting, and factor models to energy trading portfolios. Connects risk measurement tools to active portfolio construction decisions.

Lesson 2 • Performance Measurement and Attribution

Measures trading book performance using P&L attribution, Sharpe ratio, and drawdown analysis. Closes the portfolio management cycle by linking strategy design to outcome evaluation.

Lesson 3 • Spread Trading Strategies

Develops strategies exploiting time, location, quality, and inter-commodity spreads in energy markets. Builds on pricing and derivatives knowledge to create actionable trading ideas.

Lesson 4 • Fundamental and Technical Analysis

Integrates supply-demand fundamental analysis with technical chart methods for energy price forecasting. Equips students to combine both analytical traditions in a trading decision framework.