Derivatives trading rises in North American regional crudes

Oil firms turning to LLS, WCS, Mars and Midland for hedging exposures

Oil hedging

In the past, North American energy companies looking to hedge their exposure to crude oil prices did not have a broad menu of instruments to choose from. By and large, they had two choices: West Texas Intermediate (WTI), the dominant benchmark for US domestic crude, based on prices at the storage hub of Cushing, Oklahoma, and North Sea Brent, the seaborne benchmark preferred internationally. Limited physical markets existed for other grades of crude oil, with various specifications and delivery