A change of ownership and an evolving regulatory landscape have thrown up big challenges for the London Metal Exchange in its quest to clear its own trades. Trevor Spanner, the chief executive of LME Clear, speaks to Mark Pengelly about the project
NWE market coupling delays highlight need for robust EU energy regulator, says former EC director general
Today, regulation is a fact of life for OTC commodity derivatives traders. But in April 1994, it was somewhat novel, as Energy Risk reported at the time
The deregulation of Australian electricity markets has brought several challenges, including the possibility of price spikes, which expose market participants to significant risks. As Adebayo Aderounmu and Rodney Wolff outline, these spikes are hard to...
Dodd-Frank and Mifid II position limits could cause firms to withdraw from commodity derivatives
Lynton Jones, the IPE’s former chief executive, tried hard to promote electronic trading in Brent futures. But those efforts met with strong resistance, he tells Mark Pengelly
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Banks have often stepped in and out of the OTC energy derivatives market. In this article from August 2001, Energy Risk reports on banks upping their activity
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Overreliance on modern risk management systems, and metrics such as value-at-risk, can blind firms to tectonic structural market shifts. To help alleviate this problem, the use of human judgement and intervention is required, argues Vincent Kaminski
Debate continues to rage about the merits of clearing, with some market observers arguing that the benefits of using central counterparties are outweighed by the precipitous costs involved. But such criticisms fail to take the full burden of over-the-counter...
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In this paper, Magnus Wobben, Tilman Huhne, Yuri Ivanov and Sebastian Hanneken examine the impact of market incompleteness on the valuation of gas storage contracts. In contrast to prior research, their proposed valuation framework accounts for the contract...
Allegations of manipulation are particularly bad for energy trading firms, which should respond by holding themselves to higher standards
Despite massive investment in human capital and technical resources, risk managers failed to warn about the dangers of toxic assets and excessive leverage in the run-up to the global financial crisis. Their lack of authority is partly to blame, writes...
Energy Risk looks in detail at the US Dodd-Frank Act and its implications for commodity and energy market participants
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Stress testing is a vital part of successful risk management, but risk managers at energy trading firms frequently face obstacles in designing and implementing successful stress testing programmes. In this article, Carlos Blanco provides some advice on...
Clear and unambiguous rules have the potential to satisfy advocates of sterner regulation, as well as regulated firms
A new book, Commodity Investing and Trading, is now on sale from Risk Books. Energy Risk provides an exclusive preview
At Stadtwerke München, one of Germany’s largest municipal utilities, many of the issues facing risk management are different from those affecting big commercial energy firms. But concerns about the impact of financial regulation run just as high. Mark...
Commodity trading firms urged to use advancements in big data to gain strategic advantage
Derivatives regulation will impede attempts by banks to compete and do lasting damage to European market, says founder of SEB’s commodity business
Despite differences in the detail, the mechanics that unfold during episodes of financial and energy market hype are the same. To avoid repeating the errors of the past, companies and individuals should bear them in mind, argues Vincent Kaminski