Exposing the past: oil hedgers prepare for crude volatility

Historic crude price fluctuations make hedging critical. With prices falling across global markets, many exploration and production companies have assessed their risk and are calculating the best way to deal with it – internally and externally

“Planning is half of living.” If only those corporates on the wrong side of last summer’s oil price slump had this ancient Arabic proverb in mind when crude prices were in the doldrums. Unfortunately, many firms, including a number of oil producers, high-profile airlines and commodity market participants failed to deploy sufficient hedging policies.

This is hardly surprising as, beyond Wall Street and London’s Square Mile, the purchasing of futures and options contracts is a skill most